The present study was carried out with 120 Native Tamil speakers to know the effects of age and instructional language on narrative comprehension and inference-making ability. Children from 3rd to 5th grades (8 to 11 years) were divided into Group A (n = 60; Monolinguals) and Group B (n = 60; Bilinguals). Seven questions were framed to assess literal content (2 questions), coherence inference (2 questions), simile comprehension (2 questions), and elaborative inference (1 question). Written responses were obtained from participants after listening to the audiotape of a narrative passage. Group A provided responses in Tamil after listening to the passage in Tamil, and Group B provided responses in Tamil and English after listening to passages in Tamil and English. The responses were scored by three speech-language pathologists and average scores were statistically analyzed. The scores of the statistical analysis showed a difference of performance only across age. Qualitative analysis of inference types showed literal and coherence inferences were easier to make than simile comprehension and elaborative inferences for all groups. The findings of the study highlight how the comprehension of the narrative macrostructure and inference making is affected by age and instructional language.