Age-related effects on novelty processing have been reported and are linked with changes in frontal lobe functioning. Auditory novelty processing and habituation of the novelty P3 event-related potential were investigated in younger and older adults. Novelty processing, as indexed by novelty P3 amplitude, was similar between the groups. We found the expected decrease in novelty P3 amplitude at frontal regions in younger adults with repetition of novel stimuli. In contrast, older adults displayed no evidence of habituation, rather an increase in novelty P3 amplitude at frontal sites was found when novel stimuli were repeated. We extend current understanding of novelty processing in normal aging by comparing this habituation related-hyperfrontality with intellectual functioning.