The present functional magnetic resonance imaging (fMRI) study investigated whether age-related differences in the neural correlates of successful memory encoding are modulated by memory performance. Young (mean age 22 years; N = 16) and older (mean age 69 years; N = 32) subjects were scanned while making animacy decisions on visually presented words. Memory for the words was later assessed in a recognition test, allowing fMRI activity elicited by study words to be contrasted according to subsequent memory performance. Young and older adults exhibited equivalent subsequent memory effects (enhanced activity for later remembered items) in an extensive network that included left inferior prefrontal cortex and anterior hippocampus. In posterior cingulate cortex, reversed subsequent memory effects (greater activity for later forgotten items) were of greater magnitude in young subjects. A voxel-of-interest analysis conducted on left and right prefrontal subsequent memory effects revealed that the effects were distributed more bilaterally in older than in young subjects, replicating previous findings. This age-related difference was confined to older subjects with relatively poor recognition performance, who were also the only group to demonstrate statistically significant right prefrontal subsequent memory effects. The findings suggest that relative preservation of memory performance with increasing age does not depend upon right prefrontal "over-recruitment."