The functional role of the left ventral occipito-temporal cortex (vOT) in visual word processing has been studied extensively. A prominent observation is higher activation for unfamiliar but pronounceable letter strings compared to regular words in this region. Some functional accounts have interpreted this finding as driven by top-down influences (e.g., Dehaene and Cohen : Trends Cogn Sci 15:254–262; Price and Devlin : Trends Cogn Sci 15:246–253), while others have suggested a difference in bottom-up processing (e.g., Glezer et al. : Neuron 62:199–204; Kronbichler et al. : J Cogn Neurosci 19:1584–1594). We used dynamic causal modeling for fMRI data to test bottom-up and top-down influences on the left vOT during visual processing of regular words and unfamiliar letter strings. Regular words (e.g., taxi) and unfamiliar letter strings of pseudohomophones (e.g., taksi) were presented in the context of a phonological lexical decision task (i.e., “Does the item sound like a word?”). We found no differences in top-down signaling, but a strong increase in bottom-up signaling from the occipital cortex to the left vOT for pseudohomophones compared to words. This finding can be linked to functional accounts which assume that the left vOT contains neurons tuned to complex orthographic features such as morphemes or words [e.g., Dehaene and Cohen : Trends Cogn Sci 15:254-262; Kronbichler et al. : J Cogn Neurosci 19:1584–1594]: For words, bottom-up signals converge onto a matching orthographic representation in the left vOT. For pseudohomophones, the propagated signals do not converge, but (partially) activate multiple orthographic word representations, reflected in increased effective connectivity. Hum Brain Mapp 35:1668–1680, 2014. © 2013 Wiley Periodicals, Inc.