Progressive alexia is an acquired reading deficit caused by degeneration of brain regions that are essential for written word processing. Functional imaging studies have shown that early processing of the visual word form depends on a hierarchical posterior-to-anterior processing stream in occipito-temporal cortex, whereby successive areas code increasingly larger and more complex perceptual attributes of the letter string. A region located in the left lateral occipito-temporal sulcus and adjacent fusiform gyrus shows maximal selectivity for words and has been dubbed the ‘visual word form area’. We studied two patients with progressive alexia in order to determine whether their reading deficits were associated with structural and/or functional abnormalities in this visual word form system. Voxel-based morphometry showed left-lateralized occipito-temporal atrophy in both patients, very mild in one, but moderate to severe in the other. The two patients, along with 10 control subjects, were scanned with functional magnetic resonance imaging as they viewed rapidly presented words, false font strings, or a fixation crosshair. This paradigm was optimized to reliably map brain regions involved in orthographic processing in individual subjects. All 10 control subjects showed a posterior-to-anterior gradient of selectivity for words, and all 10 showed a functionally defined visual word form area in the left hemisphere that was activated for words relative to false font strings. In contrast, neither of the two patients with progressive alexia showed any evidence for a selectivity gradient or for word-specific activation of the visual word form area. The patient with mild atrophy showed normal responses to both words and false font strings in the posterior part of the visual word form system, but a failure to develop selectivity for words in the more anterior part of the system. In contrast, the patient with moderate to severe atrophy showed minimal activation of any part of the visual word form system for either words or false font strings. Our results suggest that progressive alexia is associated with a dysfunctional visual word form system, with or without substantial cortical atrophy. Furthermore, these findings demonstrate that functional MRI has the potential to reveal the neural bases of cognitive deficits in neurodegenerative patients at very early stages, in some cases before the development of extensive atrophy.