Atypical activation during the Embedded Figures Task has been demonstrated in autism, but has not been investigated in siblings or related to measures of clinical severity. We identified atypical activation during the Embedded Figures Task in participants with autism and unaffected siblings compared with control subjects in a number of temporal and frontal brain regions. Autism and sibling groups, however, did not differ in terms of activation during this task. This suggests that the pattern of atypical activation identified may represent a functional endophenotype of autism, related to familial risk for the condition shared between individuals with autism and their siblings. We also found that reduced activation in autism relative to control subjects in regions including associative visual and face processing areas was strongly correlated with the clinical severity of impairments in reciprocal social interaction. Behavioural performance was intact in autism and sibling groups. Results are discussed in terms of atypical information processing styles or of increased activation in temporal and frontal regions in autism and the broader phenotype. By separating the aspects of atypical activation as markers of familial risk for the condition from those that are autism-specific, our findings offer new insight into the factors that might cause the expression of autism in families, affecting some children but not others. (Contains 3 figures and 3 tables.)