Electroencephalography (EEG) is a sensitive method for detection of brain injury in preterm infants. Although the acute and chronic EEG changes are mainly non-specific regarding type of damage, they correlate with later neurological and cognitive function. In infants developing brain white matter damage, acute EEG findings include depression of background activity and presence of epileptic seizure activity. The chronic EEG changes associated with white matter injury and abnormal neurological development include delayed maturation, and presence of abundant Rolandic sharp waves. Cognitive limitations in preterm infants have been associated with changes in various sleep measures in EEG's recorded at full term. Continuous EEG-monitoring during neonatal intensive care shows that cerebral electrical activity during this vulnerable period can be affected by several extracerebral factors, e.g. cerebral blood flow, acidosis and some commonly used medications. For diagnosis of brain damage in preterm infants with neurophysiological methods, a combination of early continuous EEG monitoring during the initial intensive care period and full EEG, performed at later stages, is probably optimal.