Dyslexia is characterized by poor reading skills, yet often also difficulties in second-language learning. The differences between native- and second-language speech processing and the establishment of new brain representations for spoken second language in dyslexia are not, however, well understood. We used recordings of the mismatch negativity component of event-related potential to determine possible differences between the activation of long-term memory representations for spoken native- and second-language word forms in Finnish-speaking 9–11-year-old children with or without dyslexia, studying English as their second language in school. In addition, we sought to investigate whether the bottleneck of dyslexic readers' second-language learning lies at the level of word representations or smaller units and whether the amplitude of mismatch negativity is correlated with native-language literacy and related skills. We found that the activation of brain representations for familiar second-language words, but not for second-language speech sounds or native-language words, was weaker in children with dyslexia than in typical readers. Source localization revealed that dyslexia was associated with weak activation of the right temporal cortex, which has been previously linked with word-form learning. Importantly, the amplitude of the mismatch negativity for familiar second-language words correlated with native-language literacy and rapid naming scores, suggesting a close link between second-language processing and these skills.