Home environment quality is a well-known predictor of school readiness (SR), although the underlying processes are little known. This study tested two hypotheses: (a) child language mediates the association between home characteristics (socioeconomic status and exposure to reading) and SR, and (b) genetic factors partly explain the association between language and SR. Data were collected between 6 and 63 months in a large sample of twins. Results showed that home characteristics had direct effects on SR and indirect effects through child language. No genetic correlation was found between language and SR. These results suggest that home characteristics affect SR in part through their effect on early language skills, and show that this process is mainly environmental rather than genetic in nature.