Mild cognitive impairment (MCI) refers to a transitory state between healthy aging and dementia. Biomarkers are needed to facilitate early identification of MCI and predict progression to dementia. One potential neurophysiological biomarker, mismatch negativity (MMN), is an event-related potential reflecting fundamental, pre-attentive cognitive processes. MMN is reduced in normal aging and dementia and in neuropsychiatric samples and is associated with verbal memory deficits and poor executive functioning. This study aimed to investigate auditory MMN and its relationship to neuropsychological performance in MCI. Twenty-eight MCI participants and fourteen controls, aged ≥50 years, underwent neurophysiological and neuropsychological assessment, and completed questionnaires pertaining to disability. Relative to controls, the MCI group demonstrated reduced temporal MMN amplitude (p < 0.01). Reduced right temporal MMN was significantly associated with poorer verbal learning (r = 0.496; p < 0.01) and reduced left temporal MMN was significantly associated with increased self-reported disability (r = -0.419; p < 0.05). These results indicate that patients with MCI exhibit altered pre-attentive information processing, which in turn is associated with memory and psychosocial deficits. These findings overall suggest that MMN may be a viable neurophysiological biomarker of underlying disease in this 'at risk' group.