Our proficiency at any skill is critically dependent on the ability to monitor our performance, correct errors and adapt subsequent movements so that errors are avoided in the future. In this study, we aimed to dissociate the neural substrates critical for correcting unexpected trajectory errors and learning to adapt future movements based on those errors. Twenty stroke patients with focal damage to frontal or parietal regions in the left or right brain hemispheres and 20 healthy controls performed a task in which a novel mapping between actual hand motion and its visual feedback was introduced. Only patients with frontal damage in the right hemisphere failed to correct for this discrepancy during the ongoing movement. However, these patients were able to adapt to the distortion such that their movement direction on subsequent trials improved. In contrast, only patients with parietal damage in the left hemisphere showed a clear deficit in movement adaptation, but not in online correction. Left frontal or right parietal damage did not adversely impact upon either process. Our findings thus identify, for the first time, distinct and lateralized neural substrates critical for correcting unexpected errors during ongoing movements and error-based movement adaptation.