Small fixational eye-movements are a fundamental aspect of vision and thought to reflect fine shifts in covert attention during active viewing. While the perceptual benefits of these small eye movements have been demonstrated during a wide range of experimental tasks including during free viewing, their function during reading remains surprisingly unclear. Previous research demonstrated that readers with increased microsaccade rates displayed longer reading speeds. To what extent increased fixational eye movements are, however, specific to reading and might be indicative of reading skill deficits remains, however, unknown. To address this topic, we compared the eye movement scan paths of 13 neurotypical individuals and 13 subjects diagnosed with developmental dyslexia during short story reading and free viewing of natural scenes. We found that during reading only, dyslexics tended to display small eye movements more frequently compared to neurotypicals, though this effect was not significant at the population level, as it could also occur in slow readers not diagnosed as dyslexics. In line with previous research, neurotypical readers had twice as many regressive compared to progressive microsaccades, which did not occur during free viewing. In contrast, dyslexics showed similar amounts of regressive and progressive small fixational eye movements during both reading and free viewing. We also found that participants with smaller fixational saccades from both neurotypical and dyslexic samples displayed reduced reading speeds and lower scores during independent tests of reading skill. Slower readers also displayed greater variability in the landing points and temporal occurrence of their fixational saccades. Both the rate and spatio-temporal variability of fixational saccades were associated with lower phonemic awareness scores. As none of the observed differences between dyslexics and neurotypical readers occurred during control experiments with free viewing, the reported effects appear to be directly related to reading. In summary, our results highlight the predictive value of small saccades for reading skill, but not necessarily for developmental dyslexia.