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Electrophysiological monitoring using evoked potentials has become an important tool in the diagnostic evaluation and operative management of neurosurgical patients. Somatosensory evoked potentials (SEPs) have proven to be particularly beneficial for intraoperative monitoring during spinal stabilization/instrumentation, cerebrovascular procedures, and functional localization for epilepsy surgery. SEPs have also been used prognostically in patients with spinal cord and closed head injuries. More recently, motor evoked potentials (MEPs) have been introduced as a way to evaluate better the descending or motor pathways. In this article, we will discuss the basic principles and techniques of evoked potential monitoring. The anatomical and physiological basis of SEPs important to interpretation will be reviewed and the common neurosurgical applications will be discussed. Finally, we will discuss the application of MEPs, in particular MEPs generated by noninvasive transcranial magnetic stimulation of the motor cortex.