Previous research shows strong evidence of positive cross-linguistic transfer as a factor of L1 literacy. Moreover, research shows that L1 literacy supports the preservation of L1 language skills while learning L2, as oral and written languages are highly interdependent. Two theoretical frameworks can be instrumental in accounting for cross-linguistic transfer: The constructive analysis hypothesis suggests that the closer L1 and L2 are typologically, the more cross-linguistic transfer should be observed. The interdependence hypothesis postulates that bilingual transfer is also supported by L1 proficiency. These hypotheses were tested in oral language experiments, comparing typologically different languages (L1 Russian and L2 English) with different orthographic depth and language-specific characteristics. The study examines the use of morphosyntactic and lexical structures through story retelling in L1 and L2 by 13 Russian-English bilingual children (Mage = 8;2) who were readers in their L1 as well as in their L2. The results indicate a strong effect of L1 reading skills on children’s ability to use appropriate lexical and syntactic processes in their L1 and L2 narratives as well as on the reduction of L1 grammatical errors, one of the most sensitive aspects of Russian inflectional morphology. These results support the interdependence hypothesis of cross-linguistic transfer.