Episodic and contextual memories are encoded within hippocampal and neocortical circuits. Retrieving these memories is assumed to involve reactivation of neural ensembles that were wired together during learning.
The hippocampus is essential for the storage and retrieval of new episodic memories. With the passage of time, however, these same memories can be supported by the neocortex without hippocampal involvement. This process is called systems consolidation and it is thought to occur when the hippocampus reactivates and strengthens neocortical networks after learning.