An important challenge in the design and analysis of event‐related or single‐trial functional magnetic resonance imaging (fMRI) experiments is to optimize statistical efficiency, i.e., the accuracy with which the event‐related hemodynamic response to different stimuli can be estimated for a given amount of imaging time. Several studies have suggested that using a fixed inter‐stimulus‐interval (ISI) of at least 15 sec results in optimal statistical efficiency or power and that using shorter ISIs results in a severe loss of power. In contrast, recent studies have demonstrated the feasibility of using ISIs as short as 500 ms while still maintaining considerable efficiency or power. Here, we attempt to resolve this apparent contradiction by a quantitative analysis of the relative efficiency afforded by different event‐related experimental designs. This analysis shows that statistical efficiency falls off dramatically as the ISI gets sufficiently short, if the ISI is kept fixed for all trials. However, if the ISI is properly jittered or randomized from trial to trial, the efficiency improves monotonically with decreasing mean ISI. Importantly, the efficiency afforded by such variable ISI designs can be more than 10 times greater than that which can be achieved by fixed ISI designs. These results further demonstrate the feasibility of using identical experimental designs with fMRI and electro‐/magnetoencephalography (EEG/MEG) without sacrificing statistical power or efficiency of either technique, thereby facilitating comparison and integration across imaging modalities. Hum. Brain Mapping 8:109–114, 1999. © 1999 Wiley‐Liss, Inc.