This study examined the brain activity elicited by the hemispheric asymmetries and morpheme transposition of two-character Chinese words (canonical and transposed word) and pseudowords using event-related potentials (ERPs) with a dual-target rapid serial visual presentation (RSVP) task. Electrophysiological results showed facilitation effects for canonical words with centrally presented visual field (CVF) and right visual field (RVF) presentations but not with left visual field (LVF) presentations, as reflected by less negative N400 amplitudes. Moreover, more positive late positive component (LPC) amplitudes were observed for both canonical words and transposed words irrespective of the visual fields. More importantly, transposed words elicited a more negative N400 amplitude and a less positive LPC amplitude compared with the amplitudes elicited by canonical words for CVF and RVF presentations. For LVF presentations, transposed words elicited a less negative N250 amplitude compared with canonical words, and there was no significant difference between canonical words and transposed words in the N400 effect. Taken together, we concluded that character transposition facilitated the mapping of whole-word orthographic representation to semantic information in the LVF, as reflected by the N250 component, and such morpheme transposition influenced whole-word semantic processing in CVF and RVF presentations, as reflected by N400 and LPC components.