Previous exposure therapy research has suggested potential differences in emotional processing at different points in treatment (Hayes, Hope, Heimberg, 2008). For example, indicators of emotional processing may be more related to outcome during the later exposure sessions than during the initial session. This is consistent with a growing body of psychotherapy research highlighting the importance of timing and change processes across therapy. The current study examined whether the learning-but-not-benefiting hypothesis is observed in a group based intervention for clients with a range of anxiety disorders. It was hypothesized that activation and within session habituation during later, but not the initial exposure session, would be related to outcome, whereas activation and within session habituation during the first session would be related to dropout status. Results revealed that lower activation and less habituation during the first exposure was associated with increased treatment discontinuation. Second, lower peak and, to a lesser extent greater activation and habituation, during exposures were generally associated with better treatment outcomes. These findings highlight the importance of examining the complexities and timing of the exposure process.