Repeated processing of the same information is associated with decreased neuronal responses, termed repetition suppression (RS). Although RS effects (i.e., the difference in activity between novel and repeated stimuli) have been demonstrated within several brain regions, such as the medial temporal lobe, their precise neural mechanisms still remain unclear. Here, we used functional magnetic resonance imaging together with psychopharmacology in 48 healthy human subjects, demonstrating that RS effects within the mesolimbic system are differentially modulated by cholinergic and dopaminergic stimulation. The dopamine precursor levodopa (100 mg) attenuated RS within the hippocampus, parahippocampal cortex, and substantia nigra/ventral tegmental area, and the degree of this reduction correlated with recognition memory performance 24 h later. The acetylcholinesterase inhibitor galantamine (8 mg), in contrast, reversed RS into repetition enhancement, showing no relationship to subsequent recognition memory. This suggests that novelty sensitive neural populations of the mesolimbic system can dynamically shift their responses depending on the balance of cholinergic and dopaminergic neurotransmission, and these shifts can influence memory retention.