Sixteen subjects with autism and 16 with Down Syndrome (aged 5 to 27), matched on verbal mental age, watched a short puppet show or video skit and were then asked to tell the story to a listener and answer follow-up questions. The majority of both groups were able to produce recognizable, though primitive, narratives. The groups did not differ in general story characteristics, and both groups exhibited errors in language use. Subjects with autism had a greater tendency to produce bizarre language and adapt an "externalized" point of view in which the puppets/actors were seen as objects rather than characters. Down syndrome subjects produced significantly more communicative gesture. Although the groups were about equally able to supply information for follow-up questions, autistic subjects produced a higher proportion of bizarre responses. These responses were considered to be a manifestation of the pragmatic deficits exhibited by autistic subjects. Results indicate that the story recall ability of autistic subjects resembles that of language-matched mentally retarded persons. However, autistic subjects had more difficulty grasping the story as a representation of meaningful events. Results are discussed in relation to the autistic person's awareness of listener's needs and aspects of the social environment. (Author/JDD)