Goal-directed episodic simulation, the imaginative construction of a hypothetical personal event or series of events focused on a specific goal, is essential to our everyday lives. We often imagine how we could solve a problem or achieve a goal in the future, or how we could have avoided a misstep in the past, but many of the behavioral and neural mechanisms underlying such goal-directed simulations have yet to be explored. The three papers of this dissertation investigated the neural correlates of three types of future episodic simulations in Papers 1 and 2 and examined a fourth such simulation directed at past events as an adaptive, constructive process in Paper 3. Some research has associated default network activity with internally-focused, but not with goal-directed cognition. Papers 1 and 2 of this dissertation showed that regions of the default network could form functional networks with regions of the frontoparietal control network while participants imagined solving specific problems or going through a sequence of steps necessary to achieve a personal goal. When participants imagined events they associated with actually attaining a goal, default network regions flexibly coupled with reward-processing regions, providing evidence that the default network can join forces with other networks or components thereof to support goal-directed episodic simulations. Using two distinct paradigms with both young and older adults, Paper 3 focused on episodic counterfactual simulations of how past events could have turned out differently and tested whether counterfactual simulations could affect participants' memory of the original events. Our results revealed that episodic counterfactual simulations can act as a type of internally generated misinformation by causing source confusion between the original event and the imagined counterfactual outcome, especially in older adults. The findings of the three papers in this dissertation lay the groundwork for further research on the behavioral and neural mechanisms of goal-directed episodic simulations, as well as their adaptive functions and possible downsides. / Psychology