Emotional information is better remembered when mood at the time of retrieval matches it in valence (positive mood, positive material). An associative memory model predicts that this 'mood congruent' facilitation is due to the mood-related reactivation at retrieval of emotional responses which were linked to valenced information at encoding. To test this model, we presented subjects with positive and negative words at study and manipulated their mood at test while using functional imaging to monitor brain activity. Subjective mood ratings and heart rate variability both indicated that the manipulation was effective, and memory performance showed a strong trend towards facilitation in congruent conditions. In the functional imaging data, valence-specific conjunctions between encoding activity predicting subsequent memory in a congruent mood and retrieval activity relating to mood congruent recollection revealed shared responses in subgenual cingulate for positive valence and posteriolateral orbitofrontal cortex for negative valence, thus supporting the associative model. To elucidate the mnemonic basis of facilitation, independent of valence, we examined the shared correlates of positive and negative congruence and found that parts of the episodic memory system were activated by congruence in correct rejection trials, but no part of this system was activated by congruence in correctly remembered trials. This pattern suggests that mood congruent facilitation occurs at the level of attempted recall rather than that of successful recollection. © 2005 Elsevier Inc. All rights reserved.