Previous research has demonstrated that areas in the medial temporal lobe and prefrontal cortex (PFC) show increased activation during retrieval of overlapping sequences. In this study, we designed a task in which degree of overlap varied between conditions in order to parse out the contributions of hippocampal and prefrontal subregions as overlap between associations increased. In the task, participants learned sequential associations consisting of a picture frame, a face within the picture frame, and an outdoor scene. The control condition consisted of a single frame-face-scene sequence. In the low overlap condition, each frame was paired with two faces and two scenes. In the high overlap condition, each frame was paired with four faces and four scenes. In all conditions the correct scene was chosen among four possible scenes and was dependent on the frame and face that preceded the choice point. One day after training, participants were tested on the retrieval of learned sequences during fMRI scanning. Results showed that the middle and posterior hippocampus (HC) was active at times when participants acquired information that increased predictability of the correct response in the overlapping sequences. Activation of dorsolateral PFC occurred at time points when the participant was able to ascertain which set of sequences the correct response belonged to. The ventrolateral PFC was active when inhibition was required, either of irrelevant stimuli or incorrect responses. These results indicate that areas of lateral PFC work in concert with the HC to disambiguate between overlapping sequences and that sequence predictability is key to when specific brain regions become active.