The delineation of specific versus overlapping mechanisms in generalized anxiety disorder (GAD) and major depressive disorder (MDD) could shed light on the integrity of these diagnostic categories. For example, negative emotion generation is one mechanism that may be especially relevant to both disorders. Emotional processing abnormalities were examined among 97 outpatients with GAD or MDD and 25 healthy adults, using the late positive potential (LPP), an event-related potential that is larger for emotional versus neutral stimuli. GAD and MDD were also assessed dimensionally across all participants. Both MDD diagnosis and dimensional depression scores were associated with reduced ΔLPP. When controlling for MDD diagnosis/dimension, both the diagnosis and dimension of GAD were associated with increased ΔLPP. Both MDD and GAD dimensions, but not diagnoses, were associated with increased ΔRT to targets that followed emotional pictures. Therefore, MDD and GAD have distinguishable and opposing features evident in neural measures of emotion processing.