Twenty-four patients with chronic renal failure, stabilized on hemodialysis, were treated with recombinant human erythropoietin. Before treatment, all patients were anemic (mean Hct = 23.7%). Hematocrits reached normal levels (36.5%) after three months of treatment. Brain event-related potentials and neuropsychological tests were used to assess changes in brain and cognitive functions associated with the correction of anemia. Assessments were done prior to and after three and twelve months of rHuEPO treatment. The P3 component of the event-related potential increased in amplitude significantly with treatment, while its latency was unaffected. Of the four neuropsychological tests administered, scores on two improved significantly with treatment, and the other two approached significance. Taken together, these findings suggest that the correction of anemia to hematocrits near normal in uremic patients by rHuEPO treatment improves brain and cognitive function by raising levels of sustained attention, thus increasing speed and efficiency of scanning and perceptual-motor functions and enhancing learning and memory. These findings also suggest that anemia, either directly or indirectly, may impair brain function.