This longitudinal study investigated how lexical restructuring can stimulate emerging bilingual children’s phonological awareness in their first (L1) and second (L2) languages. Sixty-two English (L1) – French (L2) bilingual children (Mage = 75.7 months, SD = 3.2) were taught new English and French word pairs differing minimally in phonological contrast. The results indicated that increasing lexical specificity in English mediated the relationship between English vocabulary and English phonological awareness both concurrently and longitudinally at the end of Grade 1. A longitudinal relationship was established among French vocabulary, French lexical specificity, and French phonological awareness at the end of Grade 1. Notably, cross-language transfer from English lexical specificity was a better predictor of development in French phonological awareness, especially for words that contained phonological contrasts that occurred in both languages. The results from this study highlight the phonological foundations of early literacy and extend the lexical restructuring hypothesis to emerging bilingual children.