Event-related potentials were recorded from young and elderly subjects while they performed a modified auditory Sternberg memory task. Aging was associated with a decrease in frontal activation, suggesting that prefrontal alterations may be central to age-related impairments in auditory working memory. Young subjects showed significant serial position effects electrophysiologically, while elderly subjects showed no recency effects for P3 latency and no serial position effects for N4 and SFN amplitude. This finding, in combination with increased false alarm rates in the elderly, suggest that the two group of subjects employed different cortico-limbic circuits to perform the task.