The neural mechanisms underlying the effects of imaginal exposure therapy, in which threat-associated situations are repeatedly imagined to reduce fear responses, are unknown. Here, participants learned to associate an auditory tone with a shock, and were then exposed to the tone alone (real extinction) or asked to imagine the tone (imagined extinction). Both types of extinction reduced fMRI-measured threat-related responses after threat reinstatement. Similar networks — including the ventromedial prefrontal cortex as a central hub — were recruited by real and imagined extinction. However, the success of real and imagined extinction was predicted by activity in the nucleus accumbens and CA1, respectively, suggesting that they reduce threat responses in distinct ways.