The aim of the current study was to examine the effects of bilingualism on letter and category fluency tasks. Participants were 1,600 monolingual and bilingual children from three cities in Iran: Tehran (Persian monolinguals), Tabriz (Turkish–Persian bilinguals), and Sanandaj (Kurdish–Persian bilinguals). We separately presented nine Persian letters and thirty-one categories to the participants, and asked them to generate as many words as possible using each of these initial letters and categories within a maximum of three minutes. Bilingual children generated more words than monolingual children in the letter fluency task; this effect was more pronounced in Grade 1 and for Turkish–Persian bilinguals. However, Persian monolinguals generated significantly more words than both bilingual groups in the category fluency task. Thus, bilingualism can be of both advantage and disadvantage, and produce a dissociative effect. We discuss the results on the basis of the specific nature and different cognitive demands of letter and category fluency tasks. We suggest that the degree of language proficiency of bilinguals should be considered as an important variable in future research on bilingualism.