For the sake of a basic explanation, autism is caused by a hyperactive part of the brain. These doesn't mean they act hyper, but their brain works differently than a normal person. In most cases, functioning autistic people can focus intensely on one task and do it very well, but it basically drains resources from other parts of the brain. That's what usually results in social ineptitude, they are focused on other tasks.
Now some autistic people have such hyperactive brains that they can't function normally in any aspect. They are in their own world. This is where that la-la land stereotype comes from. That doesn't mean they're handicapped as many of these people have high mental capabilities, but they can't apply it practically in most cases.
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