Verbal information is better retained when it is self-generated rather than when it is received passively. The application of self-generation procedures has been found to improve memory in healthy elderly and in individuals with impaired cognition. Overall, the available studies support the notion that active participation in verbal encoding engages memory mechanisms that supplement those used during passive observation. Thus, the objective of this study was to investigate the age-related changes in the neural mechanisms involved in the encoding of paired-associates using a self-generation method that has been shown to improve memory performance across the lifespan. Subjects were 113 healthy right-handed adults (Edinburgh Handedness Inventory >50; 67 females) ages 18-76, native speakers of English with no history of neurological or psychiatric disorders. Subjects underwent fMRI at 3 T while performing didactic learning ("read") or self-generation learning ("generate") of 30 word pairs per condition. After fMRI, recognition memory for the second word in each pair was evaluated outside of the scanner. On the post-fMRI testing more "generate" words were correctly recognized than "read" words (p < 0.001) with older adults recognizing the "generated" words less accurately (p < 0.05). Independent component analysis of fMRI data identified task-related brain networks. Several components were positively correlated with the task reflecting multiple cognitive processes involved in self-generated encoding; other components correlated negatively with the task, including components of the default-mode network. Overall, memory performance on generated words decreased with age, but the benefit from self-generation remained consistently significant across ages. Independent component analysis of the neuroimaging data revealed an extensive set of components engaged in self-generation learning compared with didactic learning, and identified areas that were associated with age-related changes independent of performance.