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Background: Recent predictive coding accounts of autism spectrum disorder (ASD) suggest that a key deficit in ASD concerns the inflexibility in modulating local prediction errors as a function of global top-down expectations. As a direct test of this central hypothesis, we used electroencephalography to investigate whether local prediction error processing was less modulated by global context (i.e., global stimulus frequency) in ASD., Methods: A group of 18 adults with ASD was compared with a group of 24 typically developed adults on a well-validated hierarchical auditory oddball task in which participants listened to short sequences of either five identical sounds (local standard) or four identical sounds and a fifth deviant sound (local deviant). The latter condition is known to generate the mismatch negativity (MMN) component, believed to reflect early sensory prediction error processing. Crucially, previous studies have shown that in blocks with a higher frequency of local deviant sequences, top-down expectations seem to attenuate the MMN. We predicted that this modulation by global context would be less pronounced in the ASD group., Results: Both groups showed an MMN that was modulated by global context. However, this effect was smaller in the ASD group as compared with the typically developed group. In contrast, the P3b, as an electroencephalographic marker of conscious expectation processes, did not differ across groups., Conclusions: Our results demonstrate that people with ASD are less flexible in modulating their local predictions (reflected in MMN), thereby confirming the central hypothesis of contemporary predictive coding accounts of ASD., (Copyright © 2018 Society of Biological Psychiatry. Published by Elsevier Inc. All rights reserved.)