Similarity between memories is a primary cause of interference and forgetting. Exaggerating subtle differences between memories is therefore a potential mechanism for reducing interference. Here, we report a human fMRI study (n = 29, 19 female) that tested whether behavioral and neural expressions of memories are adaptively distorted to reduce interference. Participants learned and repeatedly retrieved object images, some of which were identical except for subtle color differences. Behavioral measures of color memory revealed exaggeration of differences between similar objects. Importantly, greater memory exaggeration was associated with lower memory interference. fMRI pattern analyses revealed that color information in parietal cortex was stronger during memory recall when color information was critical for discriminating competing memories. Moreover, greater representational distance between competing memories in parietal cortex predicted greater color memory exaggeration and lower memory interference. T...