Background For the human brain, habituation to irrelevant sensory input is an important function whose failure is associated with behavioral disturbances. Sensory gating can be studied by recording the brain’s electrical responses to repeated clicks: the P50 potential is normally reduced to the second of two paired clicks but not in schizophrenia patients. To identify its neural correlates, we recorded electrical traces of sensory gating directly from the human hippocampus and neocortex. Methods Intracranial evoked potentials were recorded using hippocampal depth electrodes and subdural strip and grid electrodes in 32 epilepsy patients undergoing invasive presurgical evaluation. Results We found evidence of sensory gating only in the hippocampus, the temporo-parietal region (Brodmann’s areas 22 and 2), and the prefrontal cortex (Brodmann’s areas 6 and 24); however, whereas neocortical habituating responses to paired clicks were peaking around 50 msec, responses within the hippocampus proper had a latency of about 250 msec. Conclusions Consistent with data from animal studies, our findings show that the hippocampus proper contributes to sensory gating, albeit during a time window following neocortical habituation processes. Thus, sensory gating may be a multistep process, with an early phase subserved by the temporo-parietal and prefrontal cortex and a later phase mediated by the hippocampus.