A compression-release brake system for effectuating a compression-release engine braking operation in connection with an internal combustion engine. The system includes a lost motion exhaust rocker assembly including a rocker arm, an actuation piston slidably received by the rocker arm to define part of a piston cavity in the rocker arm and movable between a piston retracted position and a piston extended position, the actuation piston configured to operatively associate with the exhaust valve to permit unseating of the exhaust valve from the seated state, and a reset device received by the rocker arm and operatively associated with the actuation piston to return the exhaust valve to the seated state by the end of the expansion stroke in the brake-on mode.