Event-related brain potentials were measured in 7- and 12-month-old infants to examine the development of processing happy and angry facial expressions. In 7-month-olds a larger negativity to happy faces was observed at frontal, central, temporal and parietal sites (Experiment 1), whereas 12-month-olds showed a larger negativity to angry faces at occipital sites (Experiment 2). These data suggest that processing of these facial expressions undergoes development between 7 and 12 months: while 7-month-olds exhibit heightened sensitivity to happy faces, 12-month-olds resemble adults in their heightened sensitivity to angry faces. In Experiment 3 infants' visual preference was assessed behaviorally, revealing that the differences in ERPs observed at 7 and 12 months do not simply reflect differences in visual preference.