The 'gaze aversion hypothesis', suggests that people with Autism Spectrum Disorder (ASD) avoid mutual gaze because they experience it as hyper-arousing. To test this hypothesis we showed mutual and averted gaze stimuli to 23 mixed-ability preschoolers with ASD (M Mullen DQ = 68) and 21 typically-developing preschoolers, aged 2-5 years, using eye-tracking technology to measure visual attention and emotional arousal (i.e., pupil dilation). There were no group differences in attention to the eye region or pupil dilation. Both groups dilated their pupils more to mutual compared to averted gaze. More internalizing symptoms in the children with ASD related to less emotional arousal to mutual gaze. The pattern of results suggests that preschoolers with ASD are not dysregulated in their responses to mutual gaze.