Dog ownership has been linked to numerous benefits to human health and wellbeing. However, due to the lack of previous research on changes to brain activity during interactions with pet dogs, the underlying psychophysiological mechanisms are still unclear. The aim of the present study was to examine changes in heart rate (HR), heart rate variability (HRV), and electroencephalogram (EEG) power during interactions between dog owners and their pet dog. Fifty healthy adult dog owners completed baseline psychological measures and pet attachment scales. Subjective units of relaxation (SUR) as well as continuous EEG, HR, and HRV via portable devices were measured during five experimental conditions (baseline resting, relaxation-induction exercise, patting a toy dog, real dog present, and patting a real dog) in participants' homes. SUR was higher in all experimental conditions than at baseline. SUR was also higher during dog interaction than when the dog was present with no interaction. However, SUR during dog interaction was not significantly different from the toy dog and relaxation induction condition. Higher delta, theta, alpha, beta power and HR were found during dog interaction than all other conditions. Higher HRV was found during dog interaction compared to baseline, patting a toy dog, and relaxation-induction exercise, but not significantly different from the real dog present only condition. Lastly, overall HR correlated with psychological measures. Overall, the results show that there are significant changes in brain and heart activity when humans interact with pet dogs, consistent with increases in relaxation and focussed attention. These findings are relevant to understanding the potential mechanisms for health benefits associated with pets.