A modified Wason's selection task was used to explore brain correlates of hypothesis evaluation, a core process of hypothesis testing. Twenty-two undergraduate participants (11 males, 11 females) were provided with a proposition (hypothesis) and a card. They were asked to evaluate whether the card verified or falsified the given proposition while event related potentials (ERP) were measured. Behavioral results showed that participants required less time to make correct responses in verification conditions than in falsification conditions. The ERPs time-locked to the second side of each card showed that (1) smaller amplitudes of P2 were elicited in backward falsification than in backward verification, which reflected a lower intensity of perception; (2) a profound negative deflection was found in falsification conditions compared to verification conditions during the N2 time window, which implied the processing of conflicting information; (3) in comparison to verification conditions, falsification conditions evoked a decreased P3 component, which was linked to the process of hypothesis evaluation; and (4) a late positive component (400-600 ms) was only triggered in the forward falsification condition, reflecting the manipulation of cognitive context.