The present study evaluated the idea that the hemisphere-specific cognitive demands of reading and writing may induce task-specific maladaptive patterns of language lateralization in children with dyslexia. Situation-specific lateralization was examined in a repeated measures design under three dichotic listening conditions: baseline, concurrent reading, and concurrent writing. Twelve males with phonological dyslexia, 8 to 12 years old, were compared to 12 age-matched and 12 younger reading-matched good readers. Lateralization patterns were examined for condition-specific relationships to pseudoword decoding, word recognition, reading comprehension, spelling, and arithmetic. The results show that dyslexia is not related to incomplete lateralization or to a failure to inhibit verbal processing in the right hemisphere during reading and writing. Reading increased the lateralization of the children with dyslexia, which had a negative relation to arithmetic; writing caused a decrease in lateralization, which was linked specifically to deficits in phonological decoding and visual word recognition. The results suggest that children with dyslexia suffer from a selective linguistic vulnerability to left-hemisphere interference from the idiosyncratic attentional and processing demands of particular school tasks. Dyslexia is a much more dynamic and environmentally sensitive disorder than previously thought.