This thesis explores the phonological deficit of children with a familial risk of dyslexia. This approach contributes to the identification of possible linguistic precursors of dyslexia. The thesis is set within the framework of the phonological deficit hypothesis of dyslexia. Through assessment of performance of at-risk children on linguistically-based measures, as well as measures of phonological processing and awareness, this phonological deficit hypothesis can be tested and refined. Secondly, a comparison was made between the phonological abilities of children with a risk of dyslexia and children with specific language impairment (SLI). Both disorders are characterised by language and reading difficulties and it is investigated whether they are both caused by (similar) underlying phonological difficulties. This comparison contributes to the evaluation of hypotheses on the relationship between dyslexia and SLI. It is shown that the three-, four-, and five-year-old children at-risk of dyslexia displayed more difficulties than normally developing children on tasks tapping into phonology. Differences were especially evident on tasks measuring expressive phonology, word stress competence, and phonological processing. These findings confirm the phonological deficit hypothesis. They further show that a linguistically-informed approach leads to new insights; not all measures led to equally poor results of the at-risk group and the notion of ‘phonology’ in the phonological deficit should not be treated as a simple construct. Additionally, the at-risk and SLI children generally showed difficulties on the same tasks, but to a different extent and with different error patterns, indicating that dyslexia and SLI are best treated as separate disorders partly caused by a similar risk factor, i.e. poor phonology. These findings can best be subsumed by the qualitative difference hypothesis of dyslexia and SLI.