The purpose of this study was to compare the psychosocial functioning of children withrnvisual impairment in integrated and special school settings. To conduct this study 32rnchildren (M= 15, F= 17) were purposefully selected from German (integrated) and Sebetarn(pecial) school and in truments that measure their psychosocial functioning werernadministered on them. Their teachers and caregivers (who were also purposefullyrnselected) filled the social skill scale and responded to interview questions with regard tornthe children's psychosocial functioning. The T-test result indicated that at a =0.05 thererni significant difference in the psychosocial functioning of those children in the twornschool. When specifically looking into the variables the significant difference isrnobsen ed in four of the variables. Those children in the special school were found to bernbetter in their self confidence, psychological adjustment, social adjustment andfunctionalrnindependence The interview made with teachers and caregivers was analyzed usingrnthematic analysis and the result indicated that what was found from most of thernrespondents in the special School is in line with many of the quantitative findingsrnwhereas what was found from those in the integrated school was different from it. Thisrnstrengthens the finding that the children in the special school are beller in theirrnpsychosocial functioning than those in the integrated schoo!. From the result of the studyrnit can be concluded that educational set 'rnhas an impact on the psychosocialrnfunctioning of children with visual impairment. Finally it was recommended that beforernintegrating children with special needs in the regular class rooms some preconditionsrnmust be fulfilled like changing the altitude of teachers and sighted children towards them,rnâ€¢making the infrastructure of the schools suitable for them, availability of speciallyrntrained teachers etc. The children should be integrated not only physically but alsornsocially and intellectually and their special needs must be fulfilled. Counseling servicesrnshould also be provided for the children to strengthen their p ychosocial jill1ctioning. Itrnwas also recommended that it is beller for those children with visual impairment to joinrnspecial schools so that their psychosocial functioning would be enhanced. Thernrecommendation also highlights the need for further study and a revision in the currentrntrend in special needs education.