The extraction of optic flow fields by visual systems is crucial for course stabilization during locomotion, and relies on feedforward and lateral integration of visual inputs. Here we report a novel form of systemic, motion-sensitive lateral suppression in the dendrites of large, flow-field-selective neurons in the fly's visual lobes. Using in vivo Calcium-imaging and intracellular recordings, we demonstrate that responses in dendrites, but not axon terminals, are end inhibited by flanking gratings both in the vertical and horizontal systems. We show evidence for a mechanism involving wide-field dendritic inhibition that exceeds the retinotopic spatial extent of the dendrites. Using compartmental modeling, we point out a possible function in enhancing selectivity for optic flow fields. Our results suggest that lateral suppression is a common element serving similar functional requirements in different visual systems.