Most studies investigating the impact of literacy on oral language processing have shown that literacy provides phonological awareness skills in the processing of oral language. The implications of these results on aphasia tests could be significant and pose questions on the adequacy of such tools for testing non-literate individuals. Aiming at examining the impact of literacy on oral language processing and its implication on aphasia tests, this study tested 12 non-literate and 12 literate individuals with a modified Amharic version of the Bilingual Aphasia Test (Paradis and Amberber, 1991, Bilingual Aphasia Test. Amharic version. Hillsdale, NJ: Lawrence Erlbaum.). The problems of phonological awareness skills in oral language processing in non-literates are substantiated. In addition, compared with literate participants, non-literate individuals demonstrated difficulties in the word/sentence-picture matching tasks. This study has also revealed that the Amharic version of the Bilingual Aphasia Test may be viable for testing Amharic-speaking non-literate individuals with aphasia when modifications are incorporated.