Dysregulation of cortical excitation/inhibition (E/I) has been proposed as a neuropathological mechanism underlying core symptoms of autism spectrum disorder (ASD). Determining whether dysregulated E/I could contribute to the emergence of behavioural symptoms of ASD requires evidence from human infants prior to diagnosis. In this prospective longitudinal study, we examine differences in neural responses to auditory repetition in infants later diagnosed with ASD. Eight-month-old infants with (high-risk: n = 116) and without (low-risk: n = 27) an older sibling with ASD were tested in a non-linguistic auditory oddball paradigm. Relative to high-risk infants with typical development (n = 44), infants with later ASD (n = 14) showed reduced repetition suppression of 40-60 Hz evoked gamma and significantly greater 10-20 Hz inter-trial coherence (ITC) for repeated tones. Reduced repetition suppression of cortical gamma and increased phase-locking to repeated tones are consistent with cortical hyper-reactivity, which could in turn reflect disturbed E/I balance. Across the whole high-risk sample, a combined index of cortical reactivity (cortical gamma amplitude and ITC) was dimensionally associated with reduced growth in language skills between 8 months and 3 years, as well as elevated levels of parent-rated social communication symptoms at 3 years. Our data show that cortical 'hyper-reactivity' may precede the onset of behavioural traits of ASD in development, potentially affecting experience-dependent specialisation of the developing brain.