Recent behavioral evidence implicates reward prediction errors (RPEs) as a key factor in the acquisition of episodic memory. Yet, important neural predictions related to the role of RPEs in episodic memory acquisition remain to be tested. Humans (both sexes) performed a novel variable-choice task where we experimentally manipulated RPEs, and found support for key neural predictions with fMRI. Our results show that in line with previous behavioral observations, episodic memory accuracy increases with the magnitude of signed (i.e., better/worse-than-expected) RPEs (SRPEs). Neurally, we observe that SRPEs are encoded in the ventral striatum (VS). Crucially, we demonstrate through mediation analysis that activation in the VS mediates the experimental manipulation of SRPEs on episodic memory accuracy. In particular, SRPE-based responses in the VS (during learning) predict the strength of subsequent episodic memory (during recollection). Furthermore, functional connectivity between task-relevant processing areas...