Concurrent measures of event-related potentials (ERPs) and skin conductance responses were obtained in an auditory oddball task consisting of rare target, rare non-signal unique novel and frequent standard tones. Twelve right-handed male social drinkers participated in all four cells of the balanced placebo design in which effects of beverage and instructions as to the beverage content (expectancy) were independently manipulated. The beverage contained either juice only, or vodka mixed with juice in the ratio that successfully disguised the taste of alcohol and raised average peak blood-alcohol level to 0.045% (45 mg/dl). ERPs were sensitive to adverse effects of mild inebriation, whereas behavioural measures were not affected. Alcohol ingestion reliably increased N2 amplitude and reduced the late positive complex (LPC). A large, fronto-central P3a (280 ms latency) was recorded to novel sounds in the placebo condition, but only on the trials that also evoked electrodermal-orienting responses. Both novel and target stimuli evoked a posterior P3b (340 ms), which was independent of orienting. Alcohol selectively attenuated the P3a to novel sounds on trials with autonomic arousal. This evidence confirms the previously suggested distinction between the subcomponents of the LPC: P3a may be a central index of orienting to novel, task-irrelevant but potentially significant stimuli and is an important component of the arousal system. P3b does not have a clear relationship with arousal and may embody voluntary cognitive processing of rare task-related stimuli. Overall, these results indicate that alcohol affects multiple brain systems concerned with arousal, attentional processes and cognitive-autonomic integration.