Narrative abilities are an important part of communication, academic success, and healthy relationships. These abilities involve complex language and cognitive skills, such as precise vocabulary, control of the coherence markers, relations of cause-effect, and planning. They are also relevant during the elementary school years and interact with the socio-emotional skills necessary to understand different points of view. Oral narrative production develops dramatically from 3 to 5 years of age and is a key factor in a child’s ability to communicate about the world. During this period narratives are a product of increasing linguistic sophistication over the preschool period and there is a complex relationship between early narratives and language proficiency. So far, most research about this topic has been pursued in populations other than Latin American preschoolers. At the same time, a considerably lesser number of studies about narrative abilities development have been carried out comparing typically developing children from different socioeconomic backgrounds. To our knowledge, there are no studies in Uruguay that assess the narrative abilities development in typically developing preschool children who grow up in vulnerable contexts. It is therefore of the utmost relevance to produce empirical evidence for this population. For these reasons, this study aimed at characterizing and comparing narrative abilities and receptive vocabulary in a group of a total of 54 Uruguayan preschoolers from different socioeconomic backgrounds (middle and low socioeconomic status, SES). Children were assessed in receptive vocabulary and narrative abilities across two task conditions: (1) narrative comprehension through a story retelling task which included some final questions about the story; (2) narrative production elicited from a set of thematically related puppets. The examiner gives a child a puppet set and asks him/her to elaborate a narrative using them. After that, puppets are removed and the child is asked to retell the story without puppets. Children’s oral productions were video-taped and then transcribed and categorized using the ELAN software (Max Planck Institute for Psycholinguistics, 2019). The verbal information was categorized according to Stein and Glenn’s (1979) story grammar and considering the microstructural aspects (productivity and complexity). Analyses showed that both groups performed according to their stage of development in both narrative task conditions. With regards to the narrative comprehension task, no differences in the number of recovered categories, extension, or narrative complexity were observed. Concerning the narrative production task, there were no differences between the groups in narrative sequences, nor in the number of completed episodes in conditions neither with puppets nor without puppets. Results showed that children who grow up in poverty perform more poorly than their peers from middle-income families in receptive vocabulary, in the number of recovered episodes, ask-answer items of narrative comprehension tasks. Moreover, concerning the microstructural parameters analyses showed that children from middle socioeconomic backgrounds scored better in syntactic complexity in the without puppets condition. No differences between the groups were observed in syntactic complexity in the puppets condition. Taken together these results indicate a complex link between vocabulary and narrative abilities. It is worth noting that important differences in vocabulary did not reflect in the children’s narrative performance. These findings are also relevant as a contribution to an ongoing debate about the role of vocabulary in the development of narrative abilities. Furthermore, these results could inform the discussion about the ecological validity of the test of cognitive and linguistic development. Finally, to provide some additional evidence to Uruguayan Spanish language about the relationships between oral language and cognitive development allows to carry out early interventions before formal schooling sets children for success in school and life. https://doi.org/10.16888/interd.2022.39.3.4