Research shows that, on average, children with dyslexia behave less categorically in phoneme categorization tasks. This study investigates three subtle ways that struggling readers may perform differently than their typically developing peers in this experimental context: sensitivity to the frequency distribution from which speech tokens are drawn, bias induced by previous stimulus presentations, and fatigue during the course of the task. We replicate findings that reading skill is related to categorical labeling, but we do not find evidence that sensitivity to the stimulus frequency distribution, the influence of previous stimulus presentations, and a measure of task engagement differs in children with dyslexia. It is, therefore, unlikely that the reliable relationship between reading skill and categorical labeling is attributable to artifacts of the task design, abnormal neural encoding, or executive function. Rather, categorical labeling may index a general feature of linguistic development whose causal relationship to literacy remains to be ascertained.