Letter-by-letter (LBL) dyslexia is an acquired reading disorder characterized by very slow reading and a large linear word length effect. This suggests the use of a sequential LBL strategy, in sharp contrast with the parallel letter processing used by normal subjects. Recently, we have proposed that the reading difficulty of LBL dyslexics is due to a deficit in discriminating visually similar letters based on parallel letter processing [Arguin, M., Fiset, S., & Bub, D. Sequential and parallel letter processing in letter-by-letter dyslexia. Cognitive Neuropsychology, 19, 535–555, 2002]. The visual mechanisms underlying this deficit and the LBL strategy, however, are still unknown. In this article, we propose that LBL dyslexic patients have lost the ability to use, for parallel letter processing, the optimal spatial frequency band for letter and word recognition. We claim that, instead, they rely on lower spatial frequencies for parallel processing, that these lower spatial frequencies produce confusions between visually similar letters, and that the LBL compensatory strategy allows them to extract higher spatial frequencies. The LBL strategy would thus increase the spatial resolution of the visual system, effectively resolving the issue pertaining to between-letter similarity. In Experiments 1 and 2, we succeeded in replicating the main features characterizing LBL dyslexia by having normal individuals read low-contrast, high-pass-filtered words. Experiment 3, conducted in LBL dyslexic L.H., shows that, indeed, the letter confusability effect is based on low spatial frequencies, whereas this effect was not supported by high spatial frequencies.