Background: Autism spectrum disorder (ASD) affects many aspects of life, from social interactions to (multi)sensory processing. Similarly, the condition expresses at a variety of levels of description, from genetics to neural circuits and interpersonal behavior. We attempt to bridge between domains and levels of description by detailing the behavioral, electrophysiological, and putative neural network basis of peripersonal space (PPS) updating in ASD during a social context, given that the encoding of this space relies on appropriate multisensory integration, is malleable by social context, and is thought to delineate the boundary between the self and others. Methods: Fifty (20 male/30 female) young adults, either diagnosed with ASD or age- and sex-matched individuals, took part in a visuotactile reaction time task indexing PPS, while high-density electroencephalography was continuously recorded. Neural network modeling was performed in silico. Results: Multisensory psychophysics demonstrates that while PPS in neurotypical individuals shrinks in the presence of others—as to “give space”—this does not occur in ASD. Likewise, electroencephalography recordings suggest that multisensory integration is altered by social context in neurotypical individuals but not in individuals with ASD. Finally, a biologically plausible neural network model shows, as a proof of principle, that PPS updating may be inflexible in ASD owing to the altered excitatory/inhibitory balance that characterizes neural circuits in animal models of ASD. Conclusions: Findings are conceptually in line with recent statistical inference accounts, suggesting diminished flexibility in ASD, and further these observations by suggesting within an example relevant for social cognition that such inflexibility may be due to excitatory/inhibitory imbalances.