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This article considers how information regarding processing limitations in children with specific language impairment (SLI) might be extended to assist in early identification of toddlers at risk for language disorder. A brief review of the evidence for processing capacity limitations in SLI is provided, along with results from longitudinal studies of toddlers with late onset of language development. Preliminary findings are presented from an ongoing investigation of early lexical processing for 15 late talking toddlers and 15 controls whose performance was assessed on a novel word learning task. Assessment implications of a processing based account of language impairment are discussed.