"I would suggest modelling empathy to her. Select things to watch or read with her that would give good learning opportunities. Even when you're out somewhere and if you notice something "Oh, do you see that baby crying? I wonder why they're crying, what do you think they're crying about?" and then whatever your niece answers go "Yeah, that might make me cry too - I wouldn't feel very happy if that happened, would you?" or "Would you cry if that happened?" or just respond in a way to either encourage a possible answer, or encourage her to think about it further if she is way off base."

Thank you - great advice. We will do that. We want to help her (I worry that her life will be a lonely and difficult one if she can't relate to other people), but weren't sure how. When she was younger, we would give her Sesame Street books about manners and sharing and feelings, but I realize that we can do better.