Prosody is known to scaffold the learning of language, and thus understanding prosodic development is vital for language acquisition. The present study explored the unfolding prosody model of prosodic development (proposed in Frota’s et al. study in 2016) beyond early production data, to examine whether it predicted the development of early segmentation abilities. European Portuguese-learning infants aged between 5 and 17 months were tested in a series of word segmentation experiments. Developing prosodic structure was evidenced in word segmentation as proposed by the unfolding model: (i) a simple monosyllabic word shape crucially placed at a major prosodic edge was segmented first, before more complex word shapes under similar prosodic conditions; (ii) the segmentation of more complex words was easier at a major prosodic edge than in phrase-medial position; and (iii) the segmentation of complex words with an iambic pattern preceded the segmentation of words with a trochaic pattern. These findings demonstrated that word segmentation evolved with unfolding prosody, suggesting that the prosodic units developed in the unfolding process are used both as speech production planning units and to extract word-forms from continuous speech. Therefore, our study contributes to a better understanding of the mechanisms underlying word segmentation, and to a better understanding of early prosodic development, a cornerstone of language acquisition.