Despite significant social difficulties, children with autism spectrum disorder (ASD) are vulnerable to the effects of social exclusion. We recorded EEG while children with ASD and typical peers played a computerized game involving peer rejection. Children with ASD reported ostracism-related distress comparable to typically developing children. Event-related potentials (ERPs) indicated a distinct pattern of temporal processing of rejection events in children with ASD. While typically developing children showed enhanced response to rejection at a late slow wave indexing emotional arousal and regulation, those with autism showed attenuation at an early component, suggesting reduced engagement of attentional resources in the aversive social context. Results emphasize the importance of studying the time course of social information processing in ASD; they suggest distinct mechanisms subserving similar overt behavior and yield insights relevant to development and implementation of targeted treatment approaches and objective measures of response to treatment. © 2011 Elsevier Ltd. All rights reserved.