Nonword reading measures are widely used to index children’s phonics knowledge, and are included in the Phonics Screening Check currently implemented in England and under consideration in Australia. However, critics have argued that the use of nonword measures disadvantages good readers, as they will be influenced by their strong lexical knowledge and err by making word errors (e.g. reading flarm as “farm”). We tested this claim by examining the errors made by a group of 64 Year 2 children when reading aloud a set of simple nonwords. We found that stronger word readers were less likely to make a word error response than weaker word readers, with their most prevalent type of error being another nonword that was highly similar to the target. We conclude that nonword reading measures are a valid index of phonics knowledge, and that these tests do not disadvantage children who are already reading words well.