How second language (L2) learning is achieved in the human brain remains one of the fundamental questions of neuroscience and linguistics. Previous neuroimaging studies with bilinguals have consistently shown overlapping cortical organization of the native language (L1) and L2, leading to a prediction that a common neurobiological marker may be responsible for the development of the two languages. Here, by using functional MRI, we show that later skills to read in L2 are predicted by the activity level of the fusiform-caudate circuit in the left hemisphere, which nonetheless is not predictive of the ability to read in the native language. We scanned 10-y-old children while they performed a lexical decision task on L2 (and L1) stimuli. The subjects' written language (reading) skills were behaviorally assessed twice, the first time just before we performed the fMRI scan (time 1 reading) and the second time 1 y later (time 2 reading). A whole-brain based analysis revealed that activity levels in left caudate and left fusiform gyrus correlated with L2 literacy skills at time 1. After controlling for the effects of time 1 reading and nonverbal IQ, or the effect of in-scanner lexical performance, the development in L2 literacy skills (time 2 reading) was also predicted by activity in left caudate and fusiform regions that are thought to mediate language control functions and resolve competition arising from L1 during L2 learning. Our findings suggest that the activity level of left caudate and fusiform regions serves as an important neurobiological marker for predicting accomplishment in reading skills in a new language.