The prefrontal cortical (PFC) circuit plays a central role in processing social information. PFC dysfunction has been demonstrated in many autism-associated disorders, including Rett syndrome (RTT), which is caused by loss-of-function mutations in the X-linked gene MECP2. The prelimbic PFC is hypoactive in RTT, but the precise mechanisms underlying the social avoidance remain obscure. Here we studied MeCP2-deficient mice, using in vivo calcium imaging to record neuronal activities in the prelimbic medial PFC (mPFC) while mice chose whether to interact with an object or a fellow mouse. We found that prelimbic mPFC hypoactivity restricts the responsiveness of the circuit and limits its ability to decorrelate patterns encoding social and nonsocial stimuli. Optogenetic stimulation of the prelimbic circuit throughout the social interaction restored pattern discrimination and social interactivity. This work shows that what appears to be social avoidance is actually an inability to discriminate social from nonsocial cues.