The capacity to adaptively respond to negative emotion is in part dependent upon lateral areas of the prefrontal cortex (PFC). Lateral PFC areas are particularly susceptible to age-related atrophy, which affects executive function (EF). We used structural and functional magnetic resonance imaging (MRI) to test the hypothesis that older age is associated with greater medial PFC engagement during processing of negative information, and that this engagement is dependent upon the integrity of grey matter structure in lateral PFC as well as EF. Participants (n = 64, 38-79 years) viewed negative and neutral scenes while in the scanner, and completed cognitive tests as part of a larger study. Grey matter probability (GMP) was computed to index grey matter integrity. FMRI data demonstrated less activity in the left ventrolateral PFC (VLPFC) and greater ventromedial PFC (VMPFC) activity with increasing age during negative-picture viewing. Age did not correlate with amygdala responding. GMP in VLPFC and EF were negatively associated with VMPFC activity. We conclude that this change from lateral to medial PFC engagement in response to picture-induced negative affect reflects decreased reliance on executive function-related processes, possibly associated with reduced grey matter in lateral PFC, with advancing age to maintain emotional functioning.