Depressed individuals tend to use maladaptive emotion regulation strategies more frequently than non-depressed individuals while using adaptive strategies (e.g., reappraisal) less frequently. Objective neural markers of emotion regulation ability could aid in identifying youth at greatest risk for depression and functional impairment more broadly. We used electroencephalography to examine emotion regulation in adolescents (aged 14-17; N = 201) with current depression ( n = 94) and without any history of depression ( n = 107) at high ( n = 54) and low ( n = 53) risk for depression based on a maternal history of depression. Results revealed group differences in event-related potential markers of emotion regulation using multiple scoring approaches. Never-depressed adolescents had significant reductions in mean-activity and principal component analysis-identified late positive potential responses to dysphoric stimuli under reappraisal instructions compared to passive viewing. There was no significant difference in neural responses between conditions among depressed adolescents. The magnitude of the reappraisal effects appeared slightly stronger for low-risk adolescents relative to high-risk. Exploratory analyses further demonstrated that the association between neural markers of emotion regulation and overall functioning was moderated by age, such that impaired emotion regulation abilities predicted poorer functioning among older adolescents. Findings support the sensitivity of the late positive potential to emotion regulation impairments in depression and psychopathology more broadly.