A major issue in testing is the investigation of the nature and structure of language proficiency. Psycholinguists, too, deal with the internal mental representation of linguistic components. This is exactly where the convergence of testing and psycholinguistics reveals itself. One of the key issues in psycholinguistics concerns the form in which words are represented in the mind. Results of the studies in this regard show that prior to lexical search, a morphological analysis of words is attempted. So the morphemeand not the word is a basic unit in the mental lexicon. In testing, too, specialists have been concerned with the structure of language proficiency and whether certain traits exist or not. There exists strong evidence signaling the existence of a number of traits like listening and speaking abilities. In this piece of research attempt has been made to see if the finding in psycholinguistics, that the morpheme and not the word is a basic unit in the mental lexicon, matches the evidence coming from factor analysis which is so commonly used in testing. In this study, vocabulary items in a TOEFL were divided into categories of words with various combinations of morphemes and administered on 132 subjects. Findings form construct validity studies, based on factor analytic procedures, were found to show that prefixed words make up a construct different from the words with derivational suffixes, implying that vocabulary knowledge is not stored in one place. This finding supports the decompositional model in psycholinguistics which suggests that lexicon is represented in a morphologically decomposed form. As far as the distinction between derived and inflected words is concerned, the results of factor analysis show that inflected words do not load on the same factor as the derivational words do. So, it is concluded that derivational and inflectional morphemes, too, are different constructs. The whole finding in this piece of research suggests that due to the problems in the correlational evidence for construct validity studies, and due to the consensus in the field that statistical validity alone can no longer qualify a test as a good language test, as the papers in Language Testing (1985) put it, specialists in testing can get insights from psycholinguistic findings.