Correct.
The MSDN reference for this is here which (quote) says:
Specifies that statements cannot read
data that has been modified but not
committed by other transactions. This
prevents dirty reads. Data can be
changed by other transactions between
individual statements within the
current transaction, resulting in
nonrepeatable reads or phantom data.
This option is the SQL Server default.
The SELECT would need to be running under READ UNCOMMITTED in order to read the data that has been modified by the other process, but not yet had the transaction committed.