Attentional control theory (ACT) describes the mechanisms associated with the relationship between anxiety and cognitive performance. We investigated the relationship between cognitive trait anxiety, situational stress and mental effort on phonological performance using a simple (forward-) and complex (backward-) word span task. Ninety undergraduate students participated in the study. Predictor variables were cognitive trait anxiety, indexed using questionnaire scores; situational stress, manipulated using ego threat instructions; and perceived level of mental effort, measured using a visual analogue scale. Criterion variables (a) performance effectiveness (accuracy) and (b) processing efficiency (accuracy divided by response time) were analyzed in separate multiple moderated-regression analyses. The results revealed (a) no relationship between the predictors and performance effectiveness, and (b) a significant 3-way interaction on processing efficiency for both the simple and complex tasks, such that at higher effort, trait anxiety and situational stress did not predict processing efficiency, whereas at lower effort, higher trait anxiety was associated with lower efficiency at high situational stress, but not at low situational stress. Our results were in full support of the assumptions of ACT and implications for future research are discussed.