Multiple sclerosis (MS) is an inflammatory disease of the central nervous system, resulting in physical, cognitive and affective disturbances, with notable declines in the ability to learn and retain new information. In this study, we examined if higher levels of physical activity in MS individuals were associated with an increased resting-state connectivity of the hippocampus and cortex, resulting in better performance on a task of episodic memory. Forty-five individuals with a clinically definite diagnosis of MS were recruited for the study. Consistent with previous reports, hippocampus was functionally connected to the posteromedial cortex, parahippocampal gyrus, superior frontal gyrus, and the medial frontal cortex. Higher levels of physical activity in MS patients were associated with an increased coherence between the hippocampus and the posteromedial cortex (PMC). The increased connectivity between these two regions, in turn, was predictive of better relational memory, such that MS patients who showed an increased coherence between the left (not right) hippocampus and the PMC also showed better relational memory. Results of the study are interpreted in light of the challenge of disentangling effects of physical activity from effects of disease severity and its neuropathological correlates. (JINS, 2011, 17, 986–997)