By considering the recent developments in porous media, the correction to the fundamental error made by many researchers, while formulating the flow and heat transfer in porous medium over stretching surface has been incorporated in this present problem, which is still open in the literature. Here an analysis is carried out to study the flow and heat transfer characteristics in a viscoelastic fluid flow in porous medium over a stretching surface with two general cases namely PST and PHF cases, including the effects of viscous dissipation. The partial differential equations governing the flow and heat transfer are converted into ordinary differential equations and boundary conditions by suitable similarity transformation. The proposed problem has been solved analytically by power series method (using Kummer's function). The graphical results for velocity, wall frictional coefficient and temperature are presented and discussed. Furthermore, it is shown that porous medium has same effect on the flow as viscoelasticity and it is also shown that the heat flow is always from the stretching sheet to the fluid. The numeric values of wall frictional coefficient 1/2C(f)Re(x)(1/2), surface velocity gradient f(eta eta)(0) and wall temperature gradient 0(eta)(0) and wall temperature g(0) are also calculated, tabulated and discussed. (C) 2010 Elsevier Ltd. All rights reserved.