Removing interword spacing has been shown to disrupt lower-level oculomotor processes and word identification during text reading. However, the impact of these disruptions on higher-level processes remains unclear. To examine the influence of spacing on inferential processing, we monitored eye movements while participants read spaced and unspaced passages that were strongly or weakly constrained toward an inference. Removing spaces disrupted reading fluency, as evidenced by longer reading times, longer fixation durations, reduced skipping, and shorter saccades. We also observed the effects of inferential constraint for spaced passages as characterized by longer reading times, more regressions, and longer regression-path durations for weakly than strongly constrained passages. However, these constraint effects were absent for unspaced passages, suggesting that removing spaces disrupts inferential processing. Our results are consistent with models of reading and discourse processing that assume that higher-level reading processes depend on the quality of lexical representations developed at earlier, word-level reading stages.