Research on the effects on early bilingualism on reading development is scarce. Here, we tackle this question by investigating whether the exposure to dual-language contexts (use of two languages in the same conversational situation) induces a boost in phonological and reading performance through more balanced spatial auditory attentional skills. Method: Thirty Grade 1 early Spanish-Basque bilingual children predominantly exposed to dual-language contexts and 30 matched Spanish-Basque bilingual children predominantly exposed to single-language contexts were assessed on a dichotic listening task: syllables were simultaneously presented to the left and right ears and children were instructed to report the syllable they heard best. Results: The dual-language contexts group demonstrated a reduced right ear advantage than the single-language contexts group, suggesting a more balanced report of syllables across ears in the former group. Moreover, more balanced reports were associated with more efficient reading skills. Conclusions: These results suggest that the frequent exposure to dual-language contexts possibly triggers the spatial rebalance of attentional resources for speech processing, impacting positively the development of reading skills. Future studies will determine whether some bilingual experience might act as a protective factor to reduce the prevalence and severity of future reading impairments such as dyslexia.