Objectives: Fetal exposure to some antiepileptic drugs (AEDs) carries increased risk of major birth defects, and may be associated with reduced intellectual abilities. The impact on language remains unclear. This study aimed to investigate the impact of fetal AED exposure on language skills. Methods: Women with epilepsy and their children were recruited to this observational study through the Australian Pregnancy Register for Women with Epilepsy and Allied Disorders. Language skills of 102 AED-exposed children were assessed using the Clinical Evaluation of Language Fundamentals, fourth edition (CELF-4). Assessments were conducted blind to drug. Maternal epilepsy, pregnancy, and medical histories were obtained from prospectively collected records. Results: Mean CELF-4 Core Language scores of children exposed to sodium valproate in monotherapy (mean 91.5, SD 17.5) or polytherapy (mean 73.4, SD = 22.3) were significantly below the standardized test mean of 100 (p < 0.05). Mean language scores of children exposed to carbamazepine or lamotrigine monotherapy, or polytherapy without sodium valproate, were not significantly different from normal. First-trimester sodium valproate dose was negatively correlated with language scores, and significantly predicted language scores after controlling for other group differences. Conclusions: Fetal exposure to sodium valproate increases the risk of language impairment. This should be taken into account when making treatment decisions for women with epilepsy of childbearing age.