F. Edelvik, B. Andersson, S. Jakobsson, S. Larsson, M. Persson, and Y. Shirvany An improved method for dipole modeling in EEG-based source localization submitted to World Congress of Medical Physics and Biomedical Engineering, 2009. Abstract. The inverse problem in EEG-based source localization is to determine the location of the brain sources that are responsible for the measured potentials at the scalp electrodes. The brain sources are usually modeled as current dipoles which lead to a singularity in the right-hand side of the governing Poisson's equation. Subtraction methods have been proposed as a remedy and in this paper an improved subtraction method for modeling the dipoles is presented. The accuracy is demonstrated for radial and tangential sources in layered sphere models and is to the best of the authors' knowledge superior to previous methods for superficial sources. An additional advantage is that it produces a right hand side with few non-zeros which is beneficial for efficient solution of the inverse problem. Keywords: epilepsy; EEG; finite element method; source reconstruction