Research concerning the relation between memory and imagination has focused increasingly on how memory contributes to imagining or simulating future and other hypothetical events. According to the constructive episodic simulation hypothesis (Schacter and Addis, 2007a, 2007b), episodic memory plays an important role in supporting the construction of imagined future events by allowing the retrieval and flexible recombination of elements of past experiences into simulations of possible future scenarios. Further, the hypothesis holds that the same flexible recombination processes that are useful for simulating possible future experiences can produce memory errors that result from miscombining elements of past experiences. A growing number of experimental studies during the past decade have examined various aspects of this hypothesis. Here, we consider (1) cognitive studies that have tested key elements of the constructive episodic simulation hypothesis; (2) neuroimaging studies that have elucidated the neural underpinnings of the constructive episodic simulation hypothesis; (3) recent experimental evidence linking flexible recombination and episodic simulation processes with memory errors; and (4) ways in which the conceptual focus of constructive episodic simulation hypothesis has changed over the past decade.