Efficient analysis of written words in normal reading is likely to reflect use of neural circuits formed by experience during childhood rather than an innate process. We investigated the cortical sequence of word perception in first-graders (7-8 years old), with special emphasis on occipitotemporal cortex in which, in adults, letter-string-sensitive responses are detected at 150 ms after stimulus. To identify neural activation that is sensitive to either the amount of basic visual features or specifically to letter strings, we recorded whole-head magnetoencephalography responses to words embedded in three different levels of noise and to symbol strings. As was shown previously in adults, activation reflecting stimulus nonspecific visual feature analysis was localized to occipital cortex in children. It was followed by letter-string-sensitive activation in the left occipitotemporal cortex and, subsequently, in the temporal cortex. These processing stages were correlated in timing and activation strength. Compared with adults, however, the timing of activation was clearly delayed in children, and the delay was progressively increased from occipital to occipitotemporal and further to temporal areas. This finding is likely to reflect increasing immaturity of the underlying neural generators when advancing from low-level visual analysis to higher-order areas involved in written word perception. When a salient occipitotemporal letter-string-sensitive activation was detected (10 of 18 children), its strength was correlated with phonological skills, in line with the known relevance of phonological awareness in reading acquisition.