Semantically-similar labels that co-occur in child-directed speech (e.g., bunny-rabbit) are more likely to promote inductive generalization in preschoolers than non-co-occurring labels (e.g., lamb-sheep). However, it remains unclear whether this effect stems from co-occurrence or other factors, and how co-occurrence contributes to generalization. To address these issues, preschoolers were exposed to a stream of semantically-similar labels that don't co-occur in natural language, but were arranged to co-occur in the experimental setting. In Experiment 1, children exposed to the co-occurring stream were more likely to make category-consistent inferences than children in two control conditions. Experiment 2 replicated this effect and provided evidence that co-occurrence training influenced generalization only when the trained labels were categorically-similar. These findings suggest that both co-occurrence information and semantic representations contribute to preschool-age children's inductive generalization. The findings are discussed in relation to the developmental accounts of inductive generalization.