Mental schemas provide a framework into which new information can easily be integrated. In a series of experiments, we examined how incongruence that stems from a prediction error modulates memory for multicomponent events that instantiated preexisting schemas as noted in a previous study. Each event consisted of four stimulus pairs with overlapping components, presented in four blocks (A-B, B-C, C-D, D-A). A-B pairs elicited contextual expectations (A: Farm, B: Tractor) that were either met by

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... a congruent C component (C: Farmer) or violated by an incongruent one (C: Lawyer). The baseline condition included unrelated pairs, where the C component was neither congruent nor incongruent. In experiment 2, events were presented in successive trials instead of blocks, and eye movements were recorded to analyze allocation of attention. Memory was tested through old-new item recognition followed by cued recall. Across experiments, recognition and recall performance for incongruent components was reduced compared to congruent components. Incongruent items were in some cases more accurately retrieved compared to unrelated ones, depending on task demands. Additionally, better recall was observed in the incongruent D-A pairs, compared to congruent and unrelated ones, because of reduced interference from C components. Eye-tracking revealed an increased number of fixations on C components in the incongruent and unrelated conditions. These results suggest that the integration of incongruent items into an episode is impaired, compared to congruent items, despite the contextual surprise and increased attention they elicited at encoding. However, there was a beneficial effect of prediction error on memory performance, compared to a baseline, depending on the task used.