Previous research on the effect of word length on reading confounded the number of letters (NrL) in a word with its spatial width. Consequently, the extent to which visuospatial and attentional-linguistic processes contribute to the word length effect on parafoveal and foveal vision in reading and dyslexia is unknown. Scholars recently suggested that visual crowding is an important factor for determining an individual’s reading speed in fluent and dyslexic reading. We studied whether the NrL or the spatial width of target words affects fixation duration and saccadic measures in natural reading in fluent and dysfluent readers of a transparent orthography. Participants read natural sentences presented in a proportional font that contained spatially narrow and wide four- to seven-letter target words. The participants looked at spatially narrow words overall for a longer duration partially due to more frequent regressions, which showed that crowding can disrupt word recognition during normal reading. In addition, reliable NrL effects on fixation duration suggest that letters are important attentional units during reading. Saccadic measures including relative landing position, refixation and skipping probability were strongly affected by spatial width and slightly affected by the NrL, which suggests that saccadic programming and parafoveal processing of upcoming words are limited by visual acuity more than by attentional factors. The dysfluent readers overall had longer fixation durations for words but did not show larger crowding or NrL effects.