Normal aging is often difficult to distinguish from the earliest stages of Alzheimer's disease. Years before clinical memory deficits manifest, amyloid-β deposits in the cortex in many older individuals. Neuroimaging studies indicate that a set of densely connected neocortical regions, referred to as the default network, is especially vulnerable to amyloid-β deposition. Yet, the impact of amyloid-β on age-related changes within the medial temporal lobe (MTL) memory system is less clear. Here we demonstrate that cognitively normal older humans, compared with young adults, show reduced ability to modulate hippocampal activations and entorhinal deactivations during an episodic memory task. Among older adults, amyloid-β deposition was associated with failure to modulate activity in entorhinal cortex, but not hippocampus. Furthermore, we show that entorhinal regions demonstrating amyloid-β-related dysfunction are directly connected to the neocortical regions of the default network. Together these findings link neocortical amyloid-β deposition to neuronal dysfunction specifically in entorhinal cortex, while aging is associated with more widespread functional changes across the MTL.