Autistic individuals experience a secondary wave of social cognitive challenges during adolescence, which impact interpersonal success (Picci & Scherf, 2015). To better understand these challenges, we investigated the subjective experience and neural correlates of self-conscious emotion (SCE) processing in autistic adolescent males compared to age- and IQ-matched neurotypical (NT) adolescents (ages 11-17). Study I investigated group differences in SCE attributions (the ability to recognize SCEs) and empathic SCEs (the ability/tendency to feel empathic SCEs) and the potential modulatory role of heightened perspective-taking (PT) demands. Furthermore, Study I explored associations between SCE processing, a triad of social cognitive abilities (self-awareness/introspection, perspective-taking/cognitive empathy, and affective empathy), and autistic features. Study II investigated group differences in neural activation patterns recruited during SCE processing and the potential modulatory role of heightened PT demands.During an MRI scan, participants completed the Self-Conscious Emotions Task (SCET), which featured salient, ecological video clips of adolescents in a singing competition. Videos represented two factors: emotion (embarrassment, pride) and PT demands (low, high). In low PT clips, singers’ emotions matched the situational context (singing quality; sing poorly, act embarrassed); in high PT clips, they did not (sing well, act embarrassed). Participants rated how intensely embarrassed and proud each singer felt. They also rated how empathically embarrassed and proud they felt for each singer. The ASD group recognized SCEs and felt empathic SCEs, and they did so with similar intensity as the NT group. However, the ASD group made atypical emotion attributions when PT demands were high, which more strongly reflected the situational context. Atypical attributions correlated with greater perspective-taking difficulties, more intense autistic features, and reduced social competence. An over-reliance on contextual cues may reflect a strict adherence to learned social rules, possibly compensating for less reflexive mentalizing, which may underlie real-world interpersonal challenges.Neuroimaging results support this interpretation. While the ASD and NT groups recruited strikingly similar neural patterns, there were group differences within social cognition regions, visual perception regions, salience regions, and sensorimotor regions, which were modulated by changes in PT demands/the situational context. These findings similarly suggest that greater social norm referencing may serve as a compensatory strategy for less reflexive mentalizing or for difficulties integrating discrepant mental state and contextual information. Implications for intervention are discussed.