Aims: The aim of this study was to correlate the IQ of the language impaired children in autism and mental retardation with their level of development and to understand its effect on the potential to learn language in high functioning autistic, low functioning autistic and mentally retarded children. Method:The study sample was divided into three groups, notably mental retardation without autism, autism without mental retardation and autism with mental retardation. A total number of 15 subjects were recruited from each group. To maintain the consistency of the IQ mild to moderate range of MR was selected. The tools used for assessment were the Communication DEALL (Development Eclectic Approach to Language Learning), 3D LAT (Language Acquisition Test), and CARS (The Childhood Autism Ratting Scale). CARS was used to determine the diagnosis and severity of autism. The expressive and receptive language including the cognition of the children, assessed by 3D LAT was compared with the scores given by the Communication DEALL in the same areas. Result:The high functioning autistic showed a more significant improvement in all the parameters than the low functioning autistic and the mentally retarded children Conclusion: I.Q. may act as a limiting factor for low functioning autistic but high functioning autistic have problems due to specific deficits like language and perceptions. Emphasis should be placed on training of Activities of Daily Living (ADL).