Motion can be perceived when a moving pattern is defined by variations in luminance. Motion can also be perceived when a moving pattern is defined by variations in contrast. The central focus of the present study was the isolation and description of the mechanism that is responsible for the processing of the movement of contrast variations. We measured velocity discrimination thresholds to determine whether the coding of the movement of contrast-modulated (CM) patterns is mediated by the same motion mechanism as that which underlies the processing of the movement of luminance variations (sine-wave gratings). The results of the velocity discrimination studies showed that an observer's ability to detect small differences in velocity of both CM patterns and sine-wave (SW) gratings decreased (1) when variations of contrast or luminance approach detection threshold, (2) when the frame duration of an apparent motion display was lengthened, and (3) when patterns were slowed to a standard velocity of 0.75 deg/sec. Three hypotheses were discussed in light of the results. Henning's hypothesis, a two-stage model in which a higher-level system receives input from the output of a lower-level system, was best supported by the results of the present experiments.