The hippocampus is of special importance in mediating episodic memory, the type of memory involving a sequence of items/events in the context of specific time and place. The model described in this F1 assigns a function to the circuitry of the hippocampus and the various subfields. Note the reciprocal connections between two hippocampal subfield systems, the dentate gyrus and CA3 networks, both of which have recurrent connections. The CA3 network is generally considered a classic autoassociative network. The key capacity of an "autoassociative" network is that it can produce the correct firing of all cells that encode a memory when presented with only a partial or degraded form of that memory. It thus has an error correction function. It is proposed that the reciprocal connections between the dentate and CA3 have a special role in the learning and recall of sequences. Feedback of information from CA3 to dentate during learning allows synapses there to form heteroassociations. These are linkages between one memory item and next. The recall process uses the synaptic weights encoded in the dentate and CA3 as follows: after a memory cue is presented (the first item in a stored sequence), the appropriate CA3 cells are activated. These then fire the dentate cells representing the next item in the sequence using the heteroassociative linkages. This signal is then sent to CA3 where minor errors can be corrected by autoassociation. The correct second memory is then used to evoke the third memory in the dentate. In this way the whole memory sequence can be accurately recalled. The function of CA1 can be understood as follows: cued sequence recall is a form of prediction; it indicates what is likely to happen next on the basis of experience. These predictions are sent to CA1 where they are compared to a second input that arrives directly from the cortex and which carries information about sensory reality. If the prediction is not correct, a novelty signal is generated in CA1 and this is sent to the dopamine cells in the VTA, which are known to fire in response to novelty. Dopamine release may then affect target structures, including the hippocampus itself.