After adapting to a face image that has been distorted (e.g. locally contracted), the original face appears distorted in the opposite direction (e.g. expanded) (Webster & MacLin, 1999). Several lines of evidence suggest that this face distortion aftereffect (FDA) includes response changes at a high level of visual processing, but the sites and nature of these changes are not well established. We examined neural activity during the FDA using an fMRI adaptation paradigm. Face images were presented in an even block design with 17x18 sec cycles that alternated between a contracted face (adapting image, 18 sec) followed by a normal face of the same or different identity (test image, 18 sec). Contrasting the switch from the distorted to the normal face (with an FDA) to the switch in the other direction (normal to contracted / without FDA) revealed higher activity in response to distorted faces within the fusiform face area, superior temporal sulcus, and superior temporal gyrus. Surprisingly, significant activation (during the FDA) was also revealed in the motion-sensitive area MT+, suggesting that the FDA may induce a form of "motion aftereffect" even though the adapting and test images were static. This subjective motion could result from the decay of the FDA, during which the perceived distortions in the physically normal face image visibly dissipate over time. Conversely, adapting to the normal face does not bias the appearance of the distorted face and thus does not induce a temporal change. Our results are consistent with the hypothesis that individual faces are encoded as deviations from an average face and of a motion system that is activated by dynamic image distortions even if they are illusory.