Human brain activity reflects the wide time range of neural events. Measuring the brain’s electric (EEG/ERP) and magnetic (MEG) fields resolves both fast and slow neural events through completely noninvasive recordings. EEG/ERP measures the dynamics of neural activations from milliseconds to hours for a wide variety of brain states and processes, even during sleep and in infants. Mapping and source estimation localizes these dynamic activation patterns in the brain with increasing accuracy. How recent EEG/ERP research on brain function has substantially contributed to the understanding of normal development and psychiatric conditions of children and adolescents is illustrated. The high time resolution is particularly important for measuring covert processes and distinguishing cause and effect in studies of perception, attention and executive control, memory, language, and emotion. The selected clinical applications in children and adolescents covers attention deficit/hyperactivity disorder along with its main comorbid disorders, specific language disorders and dyslexia. Future applications of EEG/ERP markers may clarify the interactions between brain states and transient functions, distinguish etiological pathways through patterns of genetic modulation, and predict clinical treatment response.