This study investigates the effects of sentential context, lexical knowledge, and acoustic cues on the segmentation of connected speech. Listeners heard near-homophonous phrases (e.g., plʌmpaɪ for “plum pie” versus “plump eye”) in isolation, in a sentential context, or in a lexically biasing context. The sentential context and the acoustic cues were piloted to provide strong versus mild support for one segmentation alternative (plum pie) or the other (plump eye). The lexically biasing context favored one segmentation or the other (e.g., skʌmpaɪ for “scum pie” versus *“scump eye,” and lʌmpaɪ, for “lump eye” versus *“lum pie,” with the asterisk denoting a lexically unacceptable parse). A forced-choice task, in which listeners indicated which of two words they thought they heard (e.g., “pie” or “eye”), revealed compensatory mechanisms between the sources of information. The effect of both sentential and lexical contexts on segmentation responses was larger when the acoustic cues were mild than when they were strong. Moreover, lexical effects were accompanied with a reduction in sensitivity to the acoustic cues. Sentential context only affected the listeners’ response criterion. The results highlight the graded, interactive, and flexible nature of multicue segmentation, as well as functional differences between sentential and lexical contributions to this process.

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