The relation of morphological awareness with reading comprehension is well established. For this advance to inform instruction, the push is now on to understand how morphological awareness is related to reading comprehension. We address this question here by examining potential mechanisms. We do so with children in Grade 1, a time at which it is widely debated as to whether to include morphology instruction. We examine three potential mediating factors through which morphological awareness may contribute to reading comprehension: word reading, vocabulary, and morphological analysis, or the ability to use morphemes to understand morphologically complex words. A total of 336 English-speaking Grade 1 children participated and completed control measures of phonological awareness, nonverbal ability, socioeconomic status, working memory, and age. Initial confirmatory factor analyses showed the separability of morphological awareness, morphological analysis, and vocabulary. Multivariate path analyses revealed two indirect pathways from morphological awareness to reading comprehension: through word reading and through morphological analysis. There were no indirect effects via vocabulary, nor were there direct effects from morphological awareness to reading comprehension beyond the other variables. These findings identify two potential mechanisms by which morphological awareness connects with early reading comprehension. These findings will inform theories of reading development and may influence the development of effective early reading instruction.