The purpose of the study was to investigate the effects of inquiry-based computer simulation with heterogeneous-ability cooperative learning (HACL) and inquiry-based computer simulation with friendship cooperative learning (FCL) on (a) scientific reasoning (SR) and (b) conceptual understanding (CU) among Form Four students in Malaysian Smart Schools. The study further investigated the effects of the HACL and FCL methods on performance in scientific reasoning and conceptual understanding among students of two reasoning ability levels, namely empirical-inductive (EI) and hypothetical-deductive (HD). A quasi-experimental method that employed the 3 x 2 Factorial Design was applied in the study. The sample consisted of 301 Form Four students from 12 pure science classes in four Smart Schools which were all randomly selected and assigned to treatment (HACL & FCL) and control (TG) groups. The results showed that students in the HACL group significantly outperformed their counterparts in the FCL group who, in turn, significantly outperformed their counterparts in the TG group in scientific thinking and conceptual understanding. The findings of this study suggest that the inquiry-based computer simulation with heterogeneous-ability cooperative learning method is effective in enhancing scientific reasoning and conceptual understanding for students of all reasoning abilities, and for maximum effectiveness, cooperative learning groups should be composed of students of heterogeneous abilities. (Contains 2 tables and 2 figures.)