The validity of phoneme recognition as an indicator of phonemic awareness at kindergarten age is investigated. Six paper and pencil phonemic awareness (PA) tests, phoneme recognition among them, are administered groupwise to Dutch children a few months before the beginning of formal literacy education. Additional phonological tests and an early reading test are administered individually. Ten months later, children are tested again with PA and literacy tests. Structural equation modeling shows the relations among tests to correspond broadly with findings reported in the literature. The PA test scores are determined by one common factor, and the early PA factor influences later literacy through its influence on later PA skill. Phoneme segmentation has the highest loading on the PA factor, but phoneme recognition is its best paper and pencil representative. Unlike phoneme segmentation, phoneme recognition competence can develop in the absence of literacy skills. Phoneme recognition equals phoneme segmentation in sensitivity and specificity when predicting later literacy failure.