The aim of the present study was to investigate the grain size predominantly used by children learning to read and spell in Indonesian. Indonesian is an orthographically transparent language, and the syllable is a salient unit. Tasks assessing various levels of phonological awareness as well as letter knowledge, reading familiar words and nonwords, and spelling stem and affixed words were administered to children in Grade 1 and subsequently 1 year later in Grade 2. The results in general indicate that the phoneme is the prominent phonological unit in the early acquisition of reading and spelling in Indonesian, but the syllable also plays a significant role, particularly when reading long multisyllabic affixed words. This highlights the variable nature of grain size used by beginners, which is dependent on developmental stage, the demands of the task administered, and the characteristics of the language and its orthography.