The effect of number of EEG electrodes on the dipole localization was studied by comparing the results obtained using the 10-20 and 10-10 electrode systems. Two anatomically detailed models with resistivity values of 177.6 omega m and 67.0 omega m for the skull were applied. Simulated potential values generated by current dipoles were applied to different combinations of the volume conductors and electrode systems. High and low resistivity models differed slightly in favour of the lower skull resistivity model when dipole localization was based on noiseless data. The localization errors were approximately three times larger using low resistivity model for generating the potentials, but applying high resistivity model for the inverse solution. The difference between the two electrode systems was minor in favour of the 10-10 electrode system when simulated, noiseless potentials were used. In the presence of noise the dipole localization algorithm operated more accurately using the denser electrode system. In conclusion, increasing the number of recording electrodes seems to improve the localization accuracy in the presence of noise. The absolute skull resistivity value also affects the accuracy, but using an incorrect value in modelling calculations seems to be the most serious source of error.