This study examines the role of the lexicon and grammatical structure building in early grammar. Parent-report data in CDI format from a sample of 1151 German-speaking children between 1;6 and 2;6 and longitudinal spontaneous speech data from 22 children between 1;8 and 2;5 were used. Regression analysis of the parent-report data indicates that grammatical words have a stronger influence on concurrent syntactic complexity than lexical words. Time-lagged correlations using the spontaneous speech data showed that lexical words at 1;8 predict subsequent MLU at 2;1 significantly; grammatical words do not. MLU at 2;5 is significantly predicted by grammatical words and no longer by lexical words. The influence of different grammatical subcategories on subsequent MLU varies. Use of articles and the copula at 2;1 most strongly predicts MLU at 2;5. Children use both types of articles and multiple determiners before a noun to the same extent as adults. The present results are suggestive of early grammatical structure building.