Background: Although there are many P300 studies in depressive patients, only a few studies have focused on the effects of psychotic features in depression and of response to antidepressant treatment on P300. This study was designed to investigate possible differences in the P300 component of event-related potentials in depressed patients with and without psychotic features and if any, to see whether these changes altered with treatment of depression. Methods: Thirty-six patients with major depressive disorder diagnosed according to DSM-IV, and 20 healthy control subjects were involved in the study. Sixteen of the patients had psychotic features. Auditory P300 was recorded before treatment and after remission. Results: Pretreatment P300 latencies were significantly prolonged both in patients with and without psychotic features compared to controls. Pretreatment P300 amplitudes were significantly decreased only in the patients with psychotic features. After treatment of depression, delayed P300 latencies in both patient groups and decreased P300 amplitude in the patient group with psychotic features were normalized. Limitations: The medication status of the patient was heterogeneous. Conclusion: Since the impairment seems to be improved by drug treatment, prolonged P300 latency might be a state marker for a major depressive episode, and decreased P300 amplitude which is correlated with paranoid ideation might be more associated with psychotic subtype. (C) 2002 Elsevier Science B.V. All rights reserved.