The capacity to imagine being somewhere else and seeing the environment from a different point of view is crucial for spatial planning in daily life and for understanding the intentions, actions, and state of mind of other people. The neural bases of spatial updating of multiple object locations were investigated using functional magnetic resonance imaging. Healthy volunteers saw an array of objects on a table in a virtual reality environment and imagined movement of their own viewpoint or rotation of the array. Their memory for the locations of the objects was then tested with a change-detection task. Behavioral results confirmed the advantage for imagined viewpoint change compared with imagined array rotation of equivalent size. Encoding of object locations was associated with a network of areas, including bilateral superior and inferior parietal cortices. The precuneus was additionally activated by the demands of both viewpoint- and array rotation. The parieto-occipital sulcus/retrosplenial cortex and hippocampus were additionally activated by the demands of viewpoint rotation, while array rotation was associated with activation of the right intraparietal sulcus. These findings support a computational model of spatial memory in which parieto-occipital sulcus/retrosplenial cortex mediates spatial updating as part of a process of translation between "egocentric" and "allocentric" reference frames.