The goals of this study were to estimate the risk for lowered speech-language outcomes associated with early recurrent otitis media with effusion (OME) with and without hearing loss and to develop a preliminary descriptive-explanatory model for the findings. Three statistical approaches were used to assess associations among OME, hearing loss, and speech-language outcomes. Participants were a subsample of 70 children followed prospectively in the Dallas Cooperative Project on Early Hearing and Language Development (Friel-Patti & Finitzo, 1990). Findings indicated that hearing levels at 12-18 months were significantly associated with speech delay and low language outcomes at 3 years of age. The risk for subclinical or clinical speech delay at 3 years of age was 2% for children with less than 20 dB average hearing levels at 12-18 months and 33% for children with greater than 20 dB average hearing levels at 12-18 months. A structural equation model (Jöreskog & Sörbom, 1993) indicated that the significant and substantial effects of hearing levels at 12-18 months on speech status at 3 years were significantly mediated by language status at 3 years. Discussion includes implications of these findings for alternative speech perception models linking early OME and hearing loss to later speech-language disorder.