Steady two dimensional laminar magnetohydrodynamic (MHD) slip flow and heat transfer of a viscous incompressible and electrically conducting fluid past over a flat exponentially non-conducting stretching porous sheet embedded in a porous medium with non uniform permeability in the presence of non uniform heat source is investigated. The governing equations of velocity and temperature distributions are solved numerically and the effects of different physical parameters are shown through graphs. The rate of shear stress and the rate of heat transfer at the sheet are derived, discussed numerically and their numerical values for various values of physical parameters are presented through tables.