The present study tested the hypothesis that verbal labels support category induction by providing compact hypotheses. Ninety-seven 4- to 6-year-old children (M = 63.2 months; 46 female, 51 male; 77% White, 8% more than one race, 4% Asian, and 3% Black; tested 2018) and 90 adults (M = 20.1 years; 70 female, 20 male) in the Midwestern United States learned novel categories with features that were easy (e.g., "red") or difficult (e.g., "mauve") to name. Adults (d = 1.06) and--to a lesser extent--children (d = 0.57; final training block) learned categories composed of more nameable features better. Children's knowledge of difficult-to-name color words predicted their learning for categories with difficult-to-name features. Rule-based category learning may be supported by the emerging ability to form verbal hypotheses.