This study investigated social knowledge in school-age children, aged 8-12 years, with and without language impairment (LI and TD groups). A hypothetical peer conflict task was administered to examine the relationship among prosocial responses and parent/teacher ratings of children's social behaviours. Stimuli included 12 hypothetical peer conflict vignettes presented in an open-ended and forced choice condition. The LI group generated (open-ended) and selected (forced choice) fewer prosocial strategies. When asked to predict a friend's reaction to a selected conflict resolution strategy, the LI group predicted fewer positive consequences; however, the proportion of prosocial strategies followed by prediction of a positive peer consequence was similar across groups. Both groups identified more self-interest than relationship goals as the rationale for selected strategies. In the LI group, teacher ratings of children's social skills and problems in peer provocation situations were associated with selection of prosocial strategies. Implications for clinical service providers are discussed. (Contains 2 figures, 5 tables, and 2 notes.)