Neural changes related to the learning of the pronunciation of Chinese characters in English speakers were examined using fMRI. We examined the item-specific learning effects for trained characters and the generalization of phonetic knowledge to novel transfer characters that shared a phonetic radical (part of a character that gives a clue to the whole character's pronunciation) with trained characters. Behavioral results showed that shared phonetic information improved performance for transfer characters. Neuroimaging results for trained characters over learning found increased activation in the right lingual gyrus, and greater activation enhancement in the left inferior frontal gyrus (Brodmann's area 44) was correlated with higher accuracy improvement. Moreover, greater activation for transfer characters in these two regions at the late stage of training was correlated with better knowledge of the phonetic radical in a delayed recall test. The current study suggests that the right lingual gyrus and the left inferior frontal gyrus are crucial for the learning of Chinese characters and the generalization of that knowledge to novel characters. Left inferior frontal gyrus is likely involved in phonological segmentation, whereas right lingual gyrus may subserve processing visual-orthographic information.