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There is growing support for the emotion context insensitivity hypothesis, which states that major depressive disorder (MDD) is associated with a deficit in emotional reactivity. Under this hypothesis, depressed individuals exhibit reduced behavioral and physiological responses to both appetitive and aversive stimuli. We sought to examine this possibility using the late positive potential, a neural response sensitive to aversive and threatening stimuli.Forty-seven individuals participated in the study, 22 of whom met criteria for current MDD and 25 with no history of depression or other Axis I disorders. All individuals passively viewed emotional faces while event-related potentials were recorded.The vertex positive potential was significantly increased in response to fearful and angry faces across the entire sample. The late positive potential was also increased in response to threatening faces, but only among never-depressed individuals. In the MDD group, this electrocortical response to emotional faces was absent.This study provides neural evidence in support of the view that MDD is associated with blunted emotional reactivity to negative stimuli, which until now has been examined primarily with measures of behavior, self-report, and peripheral physiology. These results are also consistent with two prior studies showing reduced amygdala activation in response to fearful faces among depressed individuals. It remains to be determined whether abnormal activity in response to emotional stimuli is associated with trait risk for MDD or results from MDD.