Previous studies suggest the importance of medial temporal lobe, areas of parietal cortex, and retrosplenial cortex in human spatial navigation, though the exact role of these structures in representing the relations of elements within a spatial layout (“allocentric” representation) remains unresolved. Hippocampal involvement, in particular, during memory processing is affected by whether a previously formed representation is employed in a novel fashion (“flexible” usage) or in a manner comparable with how it was encoded originally (“rigid” usage). To address whether brain systems are differentially involved during flexible vs. rigid utilization of a pre-existing allocentric representation, subjects encoded the position of six different target buildings relative to a centrally located landmark building in a virtual city seen from an aerial view. They then actively searched for the locations of these target buildings using the landmark (rigid retrieval) or using a previously shown target building in a novel fashion (flexible retrieval) while undergoing fMRI. Activations in posterior superior parietal cortex and precuneus were greater during more rigid than flexible forms of allocentric retrieval while activation in the hippocampus decreased linearly over blocks during flexible allocentric retrieval. A functional connectivity analysis further revealed significant interactions between hippocampus and these parietal areas during flexible compared with rigid allocentric retrieval. These results extend previous models of the neural basis of spatial navigation by suggesting that while the posterior superior parietal cortex/precuneus play an important role in allocentric representation, the hippocampus, and interactions between hippocampus and these parietal areas, are important for flexible utilization of these representations. Hum Brain Mapp, 2013. © 2012 Wiley Periodicals, Inc.