Purpose: Using the visual world paradigm with the eye-tracking technique, this study examined the extent to which lexical tone similarity influences spoken word recognition. Method: In two experiments, participants were audibly presented with a target word and visually presented with the same target word, a tonal competitor, and two distractors, and they were required to identify the target word. In Experiment 1, the two tonal competitors shared either acoustically highly similar tones (e.g., target word: "..." /yang2tai2/, "balcony" vs. competitor: "..."/yang3zi3/, "adopted son") or acoustically lowly similar tones (e.g., target word: "..." /yang2tai2/, "balcony" vs. competitor: "..." /yang4ben3/, "sample"). In Experiment 2, the acoustic similarity of the target words and the tonal competitors shared either acoustically highly similar tones or acoustically lowly similar tones or identical tones (e.g., target word: "..." /yang2tai2/, "balcony" vs. competitor: "..." /yang2mao2/, "wool"). Results: The results of the two experiments consistently demonstrated a graded tonal competitor effect, in which acoustically highly similar tonal competitors attracted more visual attention than acoustically lowly similar tonal competitors. Conclusion: Tonal similarity plays a graded constraining role in spoken word recognition in Mandarin Chinese. [ABSTRACT FROM AUTHOR]