Converging evidence from neuroimaging studies of developmental dyslexia reveals dysfunction at posterior brain regions centered in and around the angular gyrus in the left hemisphere. We examined functional connectivity (covariance) between the angular gyrus and related occipital and temporal lobe sites, across a series of print tasks that systematically varied demands on phonological assembly. Results indicate that for dyslexic readers a disruption in functional connectivity in the language-dominant left hemisphere is confined to those tasks that make explicit demands on assembly. In contrast, on print tasks that do not require phonological assembly, functional connectivity is strong for both dyslexic and nonimpaired readers. The findings support the view that neurobiological anomalies in developmental dyslexia are largely confined to the phonological-processing domain. In addition, the findings suggest that right-hemisphere posterior regions serve a compensatory role in mediating phonological performance in dyslexic readers.