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Most word meanings are acquired incidentally from oral and written contexts. Given that vocabulary knowledge predicts reading comprehension, it is important that we better understand how children process unfamiliar words. This study describes the development of an assessment that measures children’s skill in noticing unfamiliar words while listening to texts. After expert review and a pilot study with second graders, the assessment was administered to 55 second graders. Qualitative and quantitative analyses of student responses was conducted, including an exploratory factor analysis. Results indicate that a 15-item version of the assessment has an adequate fit and adequate internal consistency reliability. The assessment may be helpful in classroom and research applications aimed at better understanding how children infer unfamiliar word meanings.