This study aims to evaluate effects of word-internal variables on reading disyllabic Chinese words by manipulating (a) morphological complexity, defined as the number of morphemes and (b) structural complexity, defined as whether the two syllables relate to each other via the specifier-head-complement structure. In a visual lexical decision task, magnetoencephalography (MEG) was recorded during the reading of four types of Chinese disyllabic words: (1), disyllabic-monomorphemic (e.g., 蚯蚓 “qiu yin” earthworms), used as the control condition; (2) coordinative compounds (such as 花草 “hua cao” flower-grass: plants), which are double-headed, with meanings jointly derived from the two roots; (3) modifier-head compounds (such as 汽車 “qi che” gas-car: an automobile), which are right-headed, with the first root as the modifier; and (4) verb-object compounds (such as 開車 “kai che” operate-car: to drive a car), in which the first and second roots express an action and an object respectively. Our source analysis indicated that, at 200 m s, reading compounds revealed larger activity in left anterior temporal cortex than reading monomorphemic words, which might reflect composition of morphologically complex words during processing. From 300 to 400 m s, reading modifier-head compounds and verb-object compounds revealed larger activity in the left posterior temporal cortex than reading monomorphemic words, but there was no significant difference between reading coordinative compounds and reading monomorphemic words in this time window. These results indicate that morphological complexity and structural complexity substantially modulate activities in left temporal cortex during the reading of disyllabic words.