Purpose: The purpose of this study was to examine feedback processing within the context of probabilistic learning in children with and without developmental language disorder (DLD). Method: The probabilistic category learning task required 28 children ages 8-13 years old to classify novel cartoon animals that differed in five binary features into one of two categories. Performance feedback guided incremental learning of the stimuli classifications. Feedback processing was compared between children with DLD and age-matched children with typical development (TD) by measuring the magnitude of feedback-related event-related potentials. Additionally, the likelihood of each group to repeat a classification of a stimulus following positive feedback ("stay" behavior) and change a classification following negative feedback ("switch" behavior) served as a measure of the consequence of feedback processing. Results: Children with DLD achieved lower classification accuracy on all learning outcomes compared to their peers with TD. Children with DLD were less likely than those with TD to demonstrate "stay" behavior or to repeat a correct response following positive feedback. "Switch" behavior or changing an incorrect response following negative feedback was found to be at chance level in both groups. Electrophysiological data indicated that children with DLD had a smaller feedback-related negativity effect (i.e., smaller differential processing of positive and negative feedback) when compared to children with TD. Although no differences were found between the two groups in the amplitude of the P3a, strong positive correlations were found between "stay/switch" behavior and the P3a for children in the TD group only. Conclusions: Children with DLD do not appear to benefit from incremental corrective feedback to the same extent as their peers with TD. Processing differences are captured in the initial stages of feedback evaluation and in translating information carried by the feedback to inform future actions.