Previous event-related potential (ERP) research of auditory rhyming showed the classical phonological rhyming effect (RE; N450) to be evident in children as young as 6 years of age (Coch, Grossi, Skendzel & Neville, 2005). ERPs to spoken nonword targets preceded by nonrhym- ing nonwords showed increased negativity (400-600ms post-stimulus- onset) in comparison to rhyming targets, and this effect was largest at posterior medial sites bilaterally. Thus the previous research suggests that the neurocognitive networks involved in processing auditory rhyme information are comparable to adults by the age of 6. The current study extends this finding to younger children aged 3, 4 and 5 years. Behavior- ally, the proportion of children with proficiency in rhyming (production and recognition skills) increased as a function of age. When comparing the RE in these age groups, no differences were found in amplitude. However, the onset of the RE decreased linearly with age. An examina- tion of 4-year-old children with different levels of rhyming proficiency revealed similar differences in the RE. Specifically, the onset of the RE was earlier in children with rhyming skills (production and recognition) as compared to children of similar age with little rhyming skills. These results will be discussed in the framework of how phonological process- ing and awareness impact language and literacy development.