The Faculty of Medicine and Health Sciences (FMHS), United Arab Emirates (UAE) University is in a unique position to explore issues related to English language proficiency and medical student performance. All students entering the FMHS have English as a second language. This study focused on the issues of students' proficiency in English as measured by the TOEFL test, student background factors and interaction in problem-based learning (PBL) groups. Using a modification of Bales Interaction Process Analysis, four problem-based learning groups were observed over four thematic units, to measure the degree of student interaction within PBL groups and to compare this to individual TOEFL scores and key background variables. The students' contributions correlated highly with TOEFL test results in the giving of information (range r = 0.67-0.74). The female students adhered to interacting in English during group sessions, whereas the male students were more likely to revert to using Arabic in elaborating unclear phenomena (p < 0.01). The educational level of the student's mother was highly predictive of TOEFL scores for the male students, but not for female students. Multivariate analysis was undertaken to analyse the relative contribution of the TOEFL, parental education and years of studying in English. The best predictor of students' contributions in PBL groups was identified as TOEFL scores. The study demonstrates the importance of facilitating a locally acceptable level of English proficiency prior to admission to the FMHS. However, it also highlights the importance of not focusing only on English proficiency but paying attention to additional factors in facilitating medical students in maximizing benefits from interactions in PBL settings.