Orthographic knowledge (i.e., the knowledge of conventions of a written language) has been identified as a predictor of both basic and higher-level reading processes, however, mostly examined in a cross-sectional design. It remains unclear, whether and how orthographic knowledge contributes uniquely in explaining differences in the acquisition of reading skills. The aim of this study was therefore to examine the effects of orthographic knowledge on basic (word-reading) and higher level (sentence- and text-comprehension) reading development in German third graders over the course of a schoolyear. 325 German speaking children ("mean age" = 8.35 years, "standard deviation" = 0.57; 49% girls) participated in the study, 100 of whom also provided data on vocabulary and naming speed. Data were analyzed via multiple regression in hierarchical models with random intercepts, since the children were nested in classes. The longitudinal analyses showed that orthographic knowledge contributes to the development of reading on the word- and text-level, over and above vocabulary knowledge and naming speed. These findings support and extend previous results, showing that orthographic knowledge not only supports reading processes, but also plays an important role in reading development over the course of a school-year. The fact that no significant interaction between orthographic knowledge and reading comprehension could be found implies that orthographic knowledge is relevant for reading development in German third graders, independent of the level of reading proficiency. The present findings suggest that orthographic knowledge should be considered in reading instruction at school as well as during reading related interventions.