Pupillometry has been found to be correlated with activity of cholinergic and noradrenergic neuromodulator systems. These systems regulate the level of cortical arousal and therefore perception, attention, and memory. Here, we tested how different types of pupil size variance (prestimulus baseline and prestimulus hippus power) may correlate with behavioral and event-related potentials (ERPs). We recorded pupil size and ERPs while participants were presented with a series of words and then asked whether the words had been in the initial list when they were later presented intermixed with unpresented words. We found that a smaller prestimulus baseline pupil size during the study phase was associated with better memory performance. Study items also evoked a larger P3 response at presentation and a greater old/new memory ERP effect at test when prestimulus pupil size was small rather than large. Prestimulus hippus power was found to be a between-subjects factor affecting the robustness of memory encoding with less power being associated with a greater old/new memory ERP effect. These results provide evidence relating memory and ERPs to variables defined on pupil size that are thought to reflect varying states of parasympathetic and sympathetic arousal.