It is well known from behavioural experiments that children with specific language impairment (SLI) have difficulties discriminating consonant–vowel (CV) syllables such as /ba/, /da/, and /ga/. Mismatch negativity (MMN) is an auditory event-related potential component that represents the outcome of an automatic comparison process. It could, therefore, be a promising tool for assessing central auditory processing deficits for speech and non-speech stimuli in children with SLI. MMN is typically evoked by occasionally occurring ‘deviant’ stimuli in a sequence of identical ‘standard’ sounds. In this study MMN was elicited using simple tone stimuli, which differed in frequency (1000 versus 1200Hz) and duration (175 versus 100ms) and to digitized CV syllables which differed in place of articulation (/ba/, /da/, and /ga/) in children with expressive and receptive SLI and healthy control children (n=21 in each group, 46 males and 17 females; age range 5 to 10 years). Mean MMN amplitudes between groups were compared. Additionally, the behavioural discrimination performance was assessed. Children with SLI had attenuated MMN amplitudes to speech stimuli, but there was no significant difference between the two diagnostic subgroups. MMN to tone stimuli did not differ between the groups. Children with SLI made more errors in the discrimination task, but discrimination scores did not correlate with MMN amplitudes. The present data suggest that children with SLI show a specific deficit in automatic discrimination of CV syllables differing in place of articulation, whereas the processing of simple tone differences seems to be unimpaired.