Novel word learning is central to the flexibility inherent in the human language capacity. Word learning may partially depend on long-term memory formation during the assembly of phonological representations from orthographic inputs. In the present study, event-related functional magnetic resonance imaging (fMRI) examined the contributions of phonological control-a component of the verbal working memory system-to phonological assembly and word learning. Subjects were scanned while making syllable decisions about visually presented familiar (English) and novel (pseudo-English and Foreign) words, a task that required retrieval and analysis of existing phonological codes or the assembly and analysis of novel representations. Results revealed that left inferior prefrontal cortex (LIPC) and bilateral parietal cortices were differentially engaged during the processing of novel words, suggesting that this circuit is recruited during phonological assembly. A subsequent memory analysis that examined the relation between fMRI signal and the subject's ability to later remember the words (a measure of effective memory formation) revealed that the magnitude of activation in LIPC, bilateral superior parietal, and left inferior parietal cortices was positively correlated with later memory. Moreover, although the magnitude of the subsequent memory effect in parietal cortex was not significantly affected by word type, this effect was greater in posterior LIPC for novel (pseudo-English) than for familiar (English) words. In the course of subserving the assembly of novel word representations, the phonological (articulatory) control component of the phonological system appears to play a central role in the encoding of novel words into long-term memory.