The present study had three main objectives. First, we aimed to evaluate whether short-duration affective states induced by negative and positive words can lead to increased error-monitoring activity relative to a neutral task condition. Second, we intended to determine whether such an enhancement is limited to words of specific valence or is a general response to arousing material. Third, we wanted to assess whether post-error brain activity is associated with incidental memory for negative and/or positive words. Participants performed an emotional stop-signal task that required response inhibition to negative, positive or neutral nouns while EEG was recorded. Immediately after the completion of the task, they were instructed to recall as many of the presented words as they could in an unexpected free recall test. We observed significantly greater brain activity in the error-positivity (Pe) time window in both negative and positive trials. The error-related negativity amplitudes were comparable in both the neutral and emotional arousing trials, regardless of their valence. Regarding behavior, increased processing of emotional words was reflected in better incidental recall. Importantly, the memory performance for negative words was positively correlated with the Pe amplitude, particularly in the negative condition. The source localization analysis revealed that the subsequent memory recall for negative words was associated with widespread bilateral brain activity in the dorsal anterior cingulate cortex and in the medial frontal gyrus, which was registered in the Pe time window during negative trials. The present study has several important conclusions. First, it indicates that the emotional enhancement of error monitoring, as reflected by the Pe amplitude, may be induced by stimuli with symbolic, ontogenetically learned emotional significance. Second, it indicates that the emotion-related enhancement of the Pe occurs across both negative and positive conditions, thus it is preferentially driven by the arousal content of an affective stimuli. Third, our findings suggest that enhanced error monitoring and facilitated recall of negative words may both reflect responsivity to negative events. More speculatively, they can also indicate that post-error activity of the medial prefrontal cortex may selectively support encoding for negative stimuli and contribute to their privileged access to memory.