We present a new wavelet-based method for single trial analysis of transient and time variant event-related potentials (ERPs). Expecting more accurate filter settings than achieved by other techniques (low-pass filter, a posteriori Wiener filter, time invariant wavelet filter), ERPs were initially balanced in time. By simulation, better filter performance could be established for test signals contaminated with either white noise or isospectral noise. To provide an example of real application, the method was applied to limbic P300 potentials (MTL-P300). As a result, variance of single trial MTL-P300s decreased, without restricting the corresponding mean. The proposed method can be regarded as an alternative for single-trial ERP analysis.