We examined performance in young and elderly on an implicit (lexical decision) and an explicit (recognition) memory test. The difference in lexical decision times between old and new words was equivalent in the two groups, although the elderly were slower. In both groups, recognition accuracy (lower in the elderly) was higher following semantic than nonsemantic encoding, whereas lexical decision times were unaffected. Divergent brain potentials for old and new words during lexical decisions constituted a repetition effect, which reflected greater positivity (200–800 ms) for old words, particularly over the left hemisphere; this effect was smaller and later in the elderly. An electrophysiological marker of enhanced recollection for words from the semantic encoding task took the form of a left-sided positivity (500–800 ms). The effect was smaller in the elderly than the young, providing an additional index of their impaired recognition processes.