The acute effects of alcohol on cognitive processing of expectancy violations were investigated using event-related brain potentials and a cued recall task to index attentional and working memory processes associated with inconsistency resolution. As predicted, expectancy-violating behaviors elicited larger late positive potentials (LPP) and were recalled better than expectancy-consistent behaviors. These effects were moderated by alcohol and the valence of initial expectancies. For placebo group participants, positive targets performing negative behaviors elicited the largest LPP responses and were recalled best. For those in the alcohol groups, negative targets behaving positively elicited the largest LPP and recall responses. These findings suggest that alcohol does not globally impair working memory processes in person perception but instead changes the nature of valenced information processing. Findings are discussed in the context of alcohol's effects on working memory processes, reward sensitivity, and the prefrontal cortical structures thought to mediate them.