The relationship between musical and linguistic skills has received particular attention in infants and school-aged children. However, very little is known about pre-schoolers. This leaves a gap in our understanding of the concurrent development of these skills during development. Moreover, attention has been focused on the effects of formal musical training, while neglecting the influence of informal musical activities at home. To address these gaps, in Study 1, 3- and 4-year-old children (n = 40) performed novel musical tasks (perception and production) adapted for young children in order to examine the link between musical skills and the development of key language capacities, namely grammar and phonological awareness. In Study 2, we investigated the influence of informal musical experience at home on musical and linguistic skills of young pre-schoolers, using the same evaluation tools. We found systematic associations between distinct musical and linguistic skills. Rhythm perception and production were the best predictors of phonological awareness, while melody perception was the best predictor of grammar acquisition, a novel association not previously observed in developmental research. These associations could not be explained by variability in general cognitive functioning, such as verbal memory and non-verbal abilities. Thus, selective music-related auditory and motor skills are likely to underpin different aspects of language development and can be dissociated in pre-schoolers. We also found that informal musical experience at home contributes to the development of grammar. An effect of musical skills on both phonological awareness and language grammar is mediated by home musical experience. These findings pave the way for the development of dedicated musical activities for pre-schoolers to support specific areas of language development.