Distinct hippocampal mechanisms support concept formation and updating.

How do we reconcile new experiences with existing knowledge? Prominent theories suggest that novel information is either captured by creating new memories or leveraged to update existing memories, yet empirical support of how these distinct memory operations unfold during learning is limited. Here, we combine computational modeling of human learning behaviour with functional neuroimaging to identify moments of memory formation and updating and characterize their neural signatures. We find that both hippocampus and ventral striatum are distinctly engaged when memories are created versus updated; however, it is only hippocampus activation that is associated with learning outcomes. Our findings motivate a key theoretical revision that positions hippocampus is a key player in building organized memories from the earliest moments of learning.