Event-related potentials (ERPs) were recorded to brief images of caregivers' and strangers' faces for 72 institutionalized children (IG), ages 7-32 months, and compared with ERPs from 33 children, ages 8-32 months, who had never been institutionalized. All children resided in Bucharest, Romania. Prominent differences in four ERP components were observed: early negative (N170), early positive (P250), midlatency negative (Nc), and positive slow wave (PSW). For all but the P250, the amplitude of these components was larger in the never institutionalized group than the institutionalized group; this pattern was reversed for the P250. Typical effects of the Nc (amplitude greater to stranger vs. caregiver) were observed in both groups; in contrast, the IG group showed an atypical pattern in the PSW. These findings are discussed in the context of the role of experience in influencing the neural circuitry putatively involved in recognizing familiar and novel faces.