Based on evidence of parasympathetic activation, early studies defined meditation as a relaxation response. Later research attempted to categorize meditation as either involving focused or distributed attentional systems. Neither of these hypotheses received strong empirical support, and most of the studies investigated Theravada style meditative practices. In this study, we compared neurophysiological (EEG, EKG) and cognitive correlates of meditative practices that are thought to utilize either focused or distributed attention, from both Theravada and Vajrayana traditions. The results of Study 1 show that both focused (Shamatha) and distributed (Vipassana) attention meditations of the Theravada tradition produced enhanced parasympathetic activation indicative of a relaxation response. In contrast, both focused (Deity) and distributed (Rig-pa) meditations of the Vajrayana tradition produced sympathetic activation, indicative of arousal. Additionally, the results of Study 2 demonstrated an immediate dramatic increase in performance on cognitive tasks following only Vajrayana styles of meditation, indicating enhanced phasic alertness due to arousal. Furthermore, our EEG results showed qualitatively different patterns of activation between Theravada and Vajrayana meditations, albeit highly similar activity between meditations within the same tradition. In conclusion, consistent with Tibetan scriptures that described Shamatha and Vipassana techniques as those that calm and relax the mind, and Vajrayana techniques as those that require ‘an awake quality’ of the mind, we show that Theravada and Vajrayana meditations are based on different neurophysiological mechanisms, which give rise to either a relaxation or arousal response. Hence, it may be more appropriate to categorize meditations in terms of relaxation vs. arousal, whereas classification methods that rely on the focused vs. distributed attention dichotomy may need to be reexamined.