Most cognitive neuroscientific research exploring the nature of age-associated compensatory mechanisms has compared old adults (high vs. average performers) to young adults (not split by performance), leaving ambiguous whether findings are truly age-related or reflect differences between high and average performers throughout the lifespan. Here, we examined differences in neural activity (as measured by ERPs) that were generated by high vs. average performing old, middle-age, and young adults while processing novel and target events to investigate the following three questions: 1) Are differences between cognitively high and average performing subjects in the allocation of processing resources (as indexed by P3 amplitude) specific to old subjects, or found throughout the adult lifespan? 2) Are differences between cognitively high and average performing subjects in speed of processing (as indexed by target P3 latency) of similar magnitude throughout the adult lifespan? 3) Where along the information processing stream does the compensatory neural activity attributed to cognitively high performing old subjects begin to take place? Our results suggest that high performing old adults successfully manage the task by a compensatory neural mechanism associated with the modulation of controlled processing and the allocation of more resources, whereas high performing younger subjects execute the task more efficiently with fewer resources. Differences between cognitively high and average performers in processing speed increase with age. Middle-age seems to be a critical stage in which substantial differences in neural activity between high and average performers emerge. These findings provide strong evidence for different patterns of agerelated changes in the processing of salient environmental stimuli, with cognitive status serving as a key mediating variable.