Letters and words are better identified when there are fewer available choices. How do readers use choice-set restrictions? By analyzing new experimental data and previously reported data, the author shows that Bayes theorem-based models overestimate readers' use of choice-set restrictions. This result is discordant with choice-similarity models such as R. D. Luce's (1963a) similarity choice model, G. Keren and S. Baggen's (1981) letter recognition model, and D. W. Massaro and G. C. Oden's (1979) fuzzy logical model of perception. Other models posit that choice restrictions affect accuracy only by improving guessing (e.g., J. L. McClelland & D. E. Rumelhart's, 1981, interactive activation model). It is shown that these models underestimate readers' use of choice-set restrictions. Restriction of choice set does improve perception of letters and words, but not optimally. Decision models that may be able to explain this phenomenon are discussed.