The insular cortex has consistently been associated with various aspects of emotion regulation and social interaction, including anger processing and overt aggression. Aggression research distinguishes proactive or instrumental aggression from retaliation, i.e. aggression in response to provocation. Here, we investigated the specific role of the insular cortex during retaliation, employing a controlled behavioral aggression paradigm implementing different levels of provocation. Fifteen healthy male volunteers underwent whole brain functional magnetic resonance imaging (fMRI) to identify brain regions involved in interaction with either a provoking or a non-provoking opponent. FMRI group analyses were complemented by examining the parametric modulations of brain activity related to the individual level of displayed aggression. These analyses identified a hemispheric lateralization as well as an anatomical segregation of insular cortex with specifically the left posterior part being involved in retaliation. The left-lateralization of insular activity during retaliation is in accordance with evidence from electro-physiological studies, suggesting left-lateralized fronto-cortical dominance during anger processing and aggressive acts. The posterior localization of insular activity, on the other hand, suggests a spatial segregation within insular cortex with particularly the posterior part being involved in the processing of emotions that trigger intense bodily sensations and immediate action tendencies.