It has recently been reported that individuals with multiple sclerosis (MS) are impaired on tasks requiring emotional processing and social cognition, including tasks of Theory of Mind (ToM) and facial affect recognition. The current pilot study examined the ability of individuals with MS to understand and interpret lies and sarcasm using a dynamic task: The Awareness of Social Inference Test (TASIT). Fifteen individuals with MS and 15 healthy controls (HCs) performed the Social Inference-Enriched subtest of the TASIT, in which they viewed video-taped social interactions in which lies and sarcasm are presented. Additionally, tests of cognition were also administered to better understand the relationship between specific cognitive abilities and the ability to understand lies and sarcasm. The MS group showed impairments in the ability to interpret and understand lies and sarcasm relative to HCs. These impairments were correlated with several cognitive abilities including processing speed, working memory, learning and memory, and premorbid IQ. The results indicate that the TASIT is a sensitive measure of social cognition in individuals with MS. Furthermore, performance on the TASIT was related to cognitive abilities. Results are discussed in terms of social cognition deficits in MS and how they relate to cognitive abilities. (JINS, 2016, 22, 83–88)