Children's idiom comprehension is an important aspect of language development. Idioms have both literal and figurative meanings, and there are often great differences between literal meaning and figurative meaning, which brings great difficulties to children's accurate understanding of idioms. As a kind of underlying language ability, metalinguistic awareness can promote the understanding of idioms. This study adopted a two-year three-wave cross-lag design to investigate the developmental relationship between children's compounding awareness and idiom comprehension and its mechanism of action. A total of 132 Chinese children in grades 3 participated in a series of tests at three-time points. After controlling the homophone awareness, homograph awareness, phonological awareness, vocabulary knowledge, rapid automatic naming, and non-verbal IQ, the following results were obtained: (1) children's compounding awareness in grade 4 had a significant predictive effect on the level of idiom comprehension in grade 5; (2) children's idiom comprehension level could predict the development of compounding awareness from grade 3 to grade 4 and from grade 4 to grade 5; (3) there was a bidirectional longitudinal relationship between children's compounding awareness and idiom comprehension from grade 4 to grade 5. The current research results emphasize the important role of compounding awareness in idiom comprehension, which brings enlightenment for future idiom teaching.