The crucial role of the medial temporal lobe (MTL) in episodic memory is well established. Although there is little doubt that its anatomical subregions-the hippocampus, peri-, entorhinal and parahippocampal cortex (PHC)-contribute differentially to mnemonic processes, their specific functions in episodic memory are under debate. Data from animal, human lesion, and neuroimaging studies suggest somewhat contradictory perspectives on this functional specialization: a general participation in declarative memory, an exclusive involvement in associative mnemonic processes, and a specific contribution to spatial memory are reported for the hippocampus, adjacent cortices, and the PHC. A functional lateralization in humans dependent on the verbalizability of the material is also discussed herein. To further elucidate the differential contributions of the various MTL subregions to encoding, we employed an object-location association memory paradigm. The memory for each of the studied associations was tested twice: by the object, and by the location serving as retrieval cue. The memory accuracy in response to both cue types was also assessed parametrically. Brain activity during encoding which leads to different degrees of subsequent memory accuracy under the two retrieval conditions was compared. We found the bilateral posterior PHC to participate in encoding of both the object associated with a location and the location associated with an object. In contrast, activity in an area in the left anterior PHC and the right anterior MTL was only correlated with the memory for the location associated with an object.