Acting in the environment results in both intended and unintended consequences. Action consequences provide feedback about the adequacy of actions while they are in progress and when they are completed and therefore contribute to monitoring actions, facilitate error detection, and are crucial for motor learning. In action imagery, no actual action takes place, and consequently, no actual action consequences are produced. However, imagined action consequences may replace actual action consequences, serving a similar function and facilitating performance improvements akin to that occurring with actual actions. In this paper, we conceptualize action imagery as a simulation based on internal models. During that simulation, forward models predict action consequences. A comparison of predicted and intended action consequences sometimes indicates the occurrence of action errors (or deviations from optimal performance) in action imagery. We review research indicating that action errors are indeed sometimes imagined in action imagery. These results are compatible with the view that action imagery is based on motor simulation but incompatible with the view that action imagery is solely based on abstract knowledge. The outlined framework seems suitable to cover a wide range of action imagery phenomena and can explain action imagery practice effects.