Evidence suggests that autism is associated with impaired emotion perception, but it is unknown how early such impairments are evident. Furthermore, most studies that have assessed emotion perception in children with autism have required verbal responses, making results difficult to interpret. This study utilized high-density event-related potentials (ERPs) to investigate whether 3–4-year-old children with autism spectrum disorder (ASD) show differential brain activity to fear versus neutral facial expressions. It has been shown that normal infants as young as 7 months of age show differential brain responses to faces expressing different emotions. ERPs were recorded while children passively viewed photos of an unfamiliar woman posing a neutral and a prototypic fear expression. The sample consisted of 29 3–4-year-old children with ASD and 22 chronological age-matched children with typical development. Typically developing children exhibited a larger early negative component (N300) to the fear than to the neutral face. In contrast, children with ASD did not show the difference in amplitude of this early ERP component to the fear versus neutral face. For a later component, typically developing children exhibited a larger negative slow wave (NSW) to the fear than to the neutral face, whereas children with autism did not show a differential NSW to the two stimuli. In children with ASD, faster speed of early processing (i.e. N300 latency) of the fear face was associated with better performance on tasks assessing social attention (social orienting, joint attention and attention to distress). These data suggest that children with ASD, as young as 3 years of age, show a disordered pattern of neural responses to emotional stimuli.