Autism is characterized by a chronic, severe impairment in social relations. Recent studies of language in autism also show pervasive deficits in pragmatics. We assume, uncontroversially, that these two deficits are linked, since pragmatics is part of social competence. This paper reviews the literature describing these deficits, and then considers two different psychological theories of these phenomena: the Affective theory and the Cognitive theory. Although the Affective theory makes better sense of the results from emotional recognition tasks, the Cognitive theory predicts the particular pattern of impaired and unimpaired social skills in autism, as well as the pragmatic deficits. These two theories might usefully be integrated in the future.