Grapheme–color synesthesia is a heritable trait where graphemes (“2”) elicit the concurrent perception of specific colors (red). Researchers have questioned whether synesthetic experiences are meaningful or simply arbitrary associations and whether these associations are perceptual or conceptual. To address these fundamental questions, ERPs were recorded as 12 synesthetes read statements such as “The Coca-Cola logo is white and 2,” in which the final grapheme induced a color that was either contextually congruous (red) or incongruous (“…white and 7,” for a synesthetes who experienced 7 as green). Grapheme congruity was found to modulate the amplitude of the N1, P2, N300, and N400 components in synesthetes, suggesting that synesthesia impacts perceptual as well as conceptual aspects of processing. To evaluate whether observed ERP effects required the experience of colored graphemes versus knowledge of grapheme–color pairings, we ran three separate groups of controls on a similar task. Controls trained to a synesthete's associations elicited N400 modulation, indicating that knowledge of grapheme–color mappings was sufficient to modulate this component. Controls trained to synesthetic associations and given explicit visualization instructions elicited both N300 and N400 modulations. Lastly, untrained controls who viewed physically colored graphemes (“2” printed in red) elicited N1 and N400 modulations. The N1 grapheme congruity effect began earlier in synesthetes than colored grapheme controls but had similar scalp topography. Data suggest that, in synesthetes, achromatic graphemes engage similar visual processing networks as colored graphemes in nonsynesthetes and are in keeping with models of synesthesia that posit early feed-forward connections between form and color processing areas in extrastriate cortex. The P2 modulation was unique to the synesthetes and may reflect neural activity that underlies the conscious experience of the synesthetic induction.