The present study explored the relationship between theory of mind, language ability and narrative discourse in a sample of 40 normally-developing 7-year-old children. Each child completed two theory of mind tasks, two language tests and narrated a wordless picture book. The narratives were coded yielding four focal components: length and complexity, story structure, referential strategy, and use of mental state terms. Aspects of the narrative drawing upon mentalistic capacities were expected to correlate with theory of mind competence. Additionally, it was anticipated that length and story structure would correlate with the language measures. There was some support for the main prediction in that one aspect of referential strategy was significantly correlated with theory of mind task performance, although there was no correlation between theory of mind and use of mental state terms. Surprisingly, there was no relationship between scores on the formal language measures and the length, complexity and story structure components of the narrative. However, a strong relationship between theory of mind competence and linguistic skills was observed. Possible explanations for these findings are considered in relation to the growing evidence of the inter-dependence of theory of mind and language abilities, and the possible use of narratives as a tool to measure mentalising competence in middle childhood.