A powerful effect resembling an afterimage is demonstrated on the pathway to the motion-sensitive neuron H1. This effect is independent of the locally generated gain control described in an earlier paper (Maddess & Laughlin 1985, Proc. R. Soc. Lond. B 225, 251). The afterimage, produced across the eye by a stationary pattern, causes the sensitivity to movement to be different according to the local stimulus history, and the effects of low-contrast (0.1) patterns, presented for as little as a few hundred milliseconds, remain for up to 2 s. Moving patterns interact with the afterimage to modulate the spike rate of H1. The afterimage increases with contrast but saturates at contrasts above 0.5. Low spatial frequencies generate afterimages less effectively than moderate ones; this result indicates that the afterimage process could lie at, or after, lateral inhibition between tonic units. This is supported by the fact that the altered sensitivity profiles generated by single bright and dark vertical bars initially resemble Mach bands. However, this character alters as the afterimage decays, and the depression of H1's response to moving bright stimuli, produced by the afterimage of a dark bar, continues to grow for up to 1 s after the adapting bar is removed. A short-lived (0.5 s) reduction of H1's directional selectivity accompanies strong afterimage formation. All these factors, especially the saturation at low contrasts and the spatial frequency tuning, rule out light adaptation by photoreceptors as the afterimage source. Luminances used were also low enough to exclude influence by the pupil mechanism. Lastly, responses to patterns that are occasionally jumped by large or small distances are broadened by stimuli that produce an afterimage. Responses to small displacements have previously been described as `velocity impulse responses' (Srinivasan 1983, Vision Res. 23, 659; Zaagman et al. 1983, IEEE Trans. SMC 13, 900) and so the response broadening (stimulus blurring) can be taken as a reduction of the fly's temporal resolution of moving objects. Previously reported work shows that afterimages seen in humans and the effect reported here act over the same range of temporal frequencies rather than retinal drift speeds. This may suggest an important role for afterimage-like effects in the processing of the low temporal frequency components of moving images. Certainly, the fly's afterimage system reduces the visibility of moving objects within patches of an image that, have on average, contained slowly varying motion signals. Given that H1 is a motion-sensitive neuron, detailed knowledge of this afterimage-like phenomenon appears to be essential for understanding the spatiotemporal function of H1, and perhaps of similar motion-sensitive neurons.