In two visual ERP studies, we investigated whether Mandarin Chinese shows a subject-preference in spite of the controversial status of grammatical relations in this language. We compared ERP responses at the position of the verb and the second NP in object-verb-subject (OVS) and subject-verb-object (SVO) structures. While SVO is the basic word order in Chinese and OV with subject-drop is possible, OVS is strongly dispreferred. At the position of the verb, which disambiguated towards an object or a subject reading of NP1, Experiment 1 revealed an N400 for both subject-initial control conditions in comparison with the critical object-initial condition. Experiment 2 showed that this result was due to differences in lexical-semantic relatedness between NP1 and the verb. When these were controlled for, we observed an N400 for the disambiguation towards an object-initial order, i.e., evidence for a subject-preference. At the postverbal NP, the object-initial condition showed a biphasic N400-late positivity pattern in both experiments. We interpret the N400 as reflecting the processing of an unexpected argument and the late positivity as a correlate of a well-formedness mismatch. Overall, our results suggest that Mandarin Chinese shows a subject-preference for an initial argument, thus providing further converging support for the notion that the subject-preference might constitute a universal processing strategy. We argue that the functional basis for this strategy lies in cross-linguistically applicable economy principles that serve to constrain incremental interpretation.