Previous work on visual search has suggested that only a single attentional template can be prioritized at any given point in time. Grouping features into objects and objects into categories can facilitate search performance by maximizing the amount of information carried by an attentional template. From infancy to adulthood, earlier studies on perceptual similarity show that consistent features increase the likelihood of grouping features into objects (e.g., Quinn & Bhatt, 2009) and objects into categories (e.g., shape bias; Landau et al., 1988). Here we ask whether lower-level intra-item similarity facilitates higher-level categorization despite inter-item dissimilarity. Adults participated in four visual search tasks where targets were defined as either one item (a specific alien) or a category (any alien) with similar features (e.g., circle belly shape, circle back spikes) or dissimilar features (e.g., circle belly shape, triangle back spikes). Using behavioral and neural measures (i.e., N2pc ERP component which typically emerges 200 milliseconds post-stimulus), we found that intra-item feature similarity facilitated categorization, despite dissimilar features across category items. Our results demonstrate that feature similarity builds novel categories and activates a task-appropriate abstract categorical search template. In other words, grouping at the lower item level facilitates grouping at the higher category level, which allows us to overcome efficiency limitations in visual search.