Prediction error-related memory enhancement depends on the neural state surrounding the prediction error event

Prediction errors (PEs) can enhance memory for preceding events. While such PE-related memory enhancements are critical for understanding adaptive memory, their underlying mechanisms are not fully understood. Using electroencephalography (EEG) and neuro-navigated transcranial magnetic stimulation (TMS) in combination with multivariate pattern analysis, this pre-registered study aimed to elucidate the brain mechanisms underlying PE effects on memory. Specifically, we tested whether PEs trigger a neural reactivation of the preceding stimulus and whether the PE-induced effects on memory depend on a specific neural state before the PE. We also examined whether inhibitory TMS over the superior parietal cortex (SPC) reduces PE effects on memory. A total of 118 participants (male and female) received sham or inhibitory theta-burst stimulation over the SPC before completing an incidental encoding-fear learning task. In this task, participants learned trial-unique stimuli and predicted whether these would be followed by an electric shock, while EEG was recorded. Recognition memory was tested 24 hours later. Our findings show that signed PEs enhance subsequent memory, depending on theta and alpha oscillations as well as neural stimulus (category) reactivation shortly before the PE. Moreover, this memory enhancement was associated with post-PE theta but not with PE-driven stimulus (category) reinstatement. Theta-burst stimulation over the SPC led to a more conservative mnemonic response bias but left the PE effect on memory unaffected. Together, our findings reveal that PE effects on memory formation are influenced by neural states and representations surrounding the PE, providing new insights into the neural mechanisms of adaptive memory formation.