Several studies have demonstrated that people with ASD and intact language skills still have problems processing linguistic information in context. Given this evidence for reduced sensitivity to linguistic context, the question arises how contextual information is actually processed by people with ASD. In this study, we used event-related brain potentials (ERPs) to examine context sensitivity in high-functioning adults with autistic disorder (HFA) and Asperger syndrome at two levels: at the level of sentence processing and at the level of solving reasoning problems. We found that sentence context as well as reasoning context had an immediate ERP effect in adults with Asperger syndrome, as in matched controls. Both groups showed a typical N400 effect and a late positive component for the sentence conditions, and a sustained negativity for the reasoning conditions. In contrast, the HFA group demonstrated neither an N400 effect nor a sustained negativity. However, the HFA group showed a late positive component which was larger for semantically anomalous sentences than congruent sentences. Because sentence context had a modulating effect in a later phase, semantic integration is perhaps less automatic in HFA, and presumably more elaborate processes are needed to arrive at a sentence interpretation.