In this article, the flow and heat transfer characteristics in an incompressible, non-Newtonian boundary layer flow of a viscoelastic fluid over a stretching sheet embedded in a porous medium with variable fluid viscosity and thermal conductivity including the effect of viscous dissipation has been examined. The fluid viscosity and thermal conductivity are assumed to be temperature dependent. Unlike the commonly employed thermal conditions of critical and prescribed surface temperature, the present study uses a convective heating boundary condition also along with the prescribed surface temperature condition. The differential equations governing the problem have been transformed by a similarity transformation into a system of non-dimensional differential equations which are solved numerically by Element Free Galerkin Method (EFGM). The effect of various physical parameters like variable fluid viscosity, thermal conductivity, heat source/sink parameter, viscoelastic parameter, porosity parameter, Eckert number, Biot number on velocity, temperature, local skin friction and local heat transfer is studied for both the cases Prescribed Surface Temperature (PST) and Newtonian heating (NH) or convective heating. The present problem finds significant application in chemical engineering, material processing, solar porous wafer absorber systems and metallurgy. (C) 2015 Sharif University of Technology. All rights reserved.