Many patients with borderline personality disorder (BPD) experience difficulties in empathizing with others and are sensitive to social exclusion. Accordingly, the authors developed a novel Social Interaction Empathy Task to examine empathy for physical and psychological pain from first- and third-person perspectives. Fifty female patients with BPD and forty-eight controls matched for age and gender were included. Alexithymia was also measured. Patients with BPD rated neutral and psychologically painful situations as more painful than healthy controls, and patients with BPD rated psychological pain as more intense in the first-person perspective than in the third-person perspective. In contrast, controls did not differentiate between the perspectives and rated physical pain as most intense. The impact of early adversity on empathy for psychological pain was mediated by alexithymia. Increased sensitivity for psychological pain in BPD correlated with symptom severity. BPD is associated with altered empathy for pain, which is related to difficulties in reflecting emotional states.