Bilingual studies on cross-linguistic transfer of phonological awareness and word recognition emphasize the relevance of nature of language and orthography. The current study was designed to examine the significance of language and orthographic structure for phonological awareness and word recognition skills in children who are native speakers of Malayalam language learning English at school. The association of phonological awareness and word recognition in 30 Malayalam speaking preschool English Language Learners (ELL’s) was tested using a set of stimuli in both English and Malayalam. Results revealed that word recognition was associated with phoneme awareness in English whereas in Malayalam, all the three levels tested in this study (rhyme, syllable and phoneme awareness) showed association with word recognition. However, considering the cross-linguistic associations, Malayalam word recognition was related to all levels of phonological awareness in English whereas no strong association was observed for word recognition in Malayalam with phonological awareness in English. Regression analysis revealed phoneme awareness in English as a strong predictor of word recognition in both the languages. These findings highlight the cross-linguistic transfer of phonological awareness between English and Malayalam supporting the Transfer Facilitation Model (TFM). Pedagogical implications of these findings on ELLs are discussed.