Event related brain potential (ERP) waveforms consist of several components extending in time, frequency and topographical space, Therefore, an efficient processing of data which involves the time, frequency and space features of the signal, may facilitate understanding the plausible connections among the functions, the anatomical structures and neurophysiological mechanisms of the brain. Wavelet transform (WT) is a powerful signal processing tool for extracting the ERP components occurring at different time and frequency spots. A technical explanation of WT in ERP processing and its four distinct applications are presented here. The first two applications aim to identify and localize the functional oddball ERP components in terms of certain wavelet coefficients in delta, theta and alpha bands in a topographical recording. The third application performs a similar characterization that involves a three stimulus paradigm. The fourth application is a single sweep ERP processing to detect the P300 in single trials. The last case is an extension of ERP component identification by combining the WT with a source localization technique. The aim is to localize the time-frequency components in three dimensional brain structure instead of the scalp surface. The time-frequency analysis using WT helps isolate and describe sequential and/or overlapping functional processes during ERP generation, and provides a possibility for studying these cognitive processes and following their dynamics in single trials during an experimental session.