Amyotrophic lateral sclerosis (ALS) is a highly debilitating and rapidly fatal neurodegenerative disease. It has been suggested that social cognition may be affected, such as impairment in theory of mind (ToM) ability. Despite these findings, research in this area is scarce and the investigation of neural mechanisms behind such impairment is absent. Nineteen patients with ALS and eighteen healthy controls participated in this study. Because the mirror neuron system (MNS) is thought to be involved in theory of mind, we first implemented a straightforward action-execution and observation task to assess basic MNS function. Second, we examined the social-cognitive ability to understand actions of others, which is a component of ToM. We used fMRI to assess BOLD activity differences between groups during both experiments. Theory of mind was also measured behaviorally using the Reading the Mind in the Eyes test (RME). ALS patients displayed greater BOLD activity during the action-execution and observation task, especially throughout right anterior cortical regions. These areas included the right inferior operculum, premotor and primary motor regions, and left inferior parietal lobe. A conjunction analysis showed significantly more co-activated voxels during both the observation and action-execution conditions in the patient group throughout MNS regions. These results support a compensatory response in the MNS during action processing. In the action understanding experiment, healthy controls performed better behaviorally and subsequently recruited greater regions of activity throughout the prefrontal cortex and middle temporal gyrus. Lastly, action understanding performance was able to cluster patients with ALS into high and lower performing groups, which then differentiated RME performance. Collectively, these data suggest that social cognition, particularly theory of mind, may be affected in a subset of patients with ALS. This impairment may be related to functioning of the MNS and other regions related to action processing and understanding. Implications for future research are discussed.