When encountering new events, memories of relevant past experiences can guide expectations about what will happen. When unexpected changes occur, this can lead to prediction errors with consequences for comprehension and subsequent memory. Current models of memory updating propose that people must first detect and register that features of the environment have changed, then encode the new event features and integrate them with relevant memories of past experiences to form configural memory representations. Aging could potentially impair each of these steps. Using functional MRI, we investigated these mechanisms in healthy young and older adults. In the scanner, participants first watched a movie depicting a series of everyday activities in a day of an actor’s life. They next watched a second movie of the day’s events in which some scenes ended differently. Crucially, before watching the last part of each scene, the movie stopped, and participants were instructed to mentally replay how the activity previously ended. Three days later, participants were asked to recall the activities. Individual differences in neural activity pattern reinstatement in the medial temporal lobes (MTL) and posteromedial cortex (PMC) during the mental replay phases of the second movie were associated with better memory for changed features in young adults. This was not the case in older adults for the MTL. This finding suggests that the MTL and PMC contribute to the comprehension of perceived changes by reinstating previous event features and that older adults are less able to use reinstatement to update memory for changed features.Significance Statement The capacity to detect, encode, and later remember changes in perceived events is crucial for everyday functioning and, like many cognitive processes supported by long-term memory, could be particularly vulnerable to aging. Here, we examined the role of neural reinstatement of episodic memories in processing changes using multivariate pattern-based functional MRI during viewing of movies of everyday activities. Detecting and remembering event changes were both associated with reinstatement in medial temporal and posteromedial brain areas of the episode-specific neural activity pattern present while viewing the original event. This effect was smaller in older adults. These results show how episodic retrieval can inform ongoing event comprehension and how this process is more effective for young than older adults.