Repetition priming refers to enhanced or biased performance with repeatedly presented stimuli. Modality-specific perceptual repetition priming has been demonstrated behaviorally for both visually and auditorily presented stimuli. In functional neuroimaging studies, repetition of visual stimuli has resulted in reduced activation in the visual cortex, as well as in multimodal frontal and temporal regions. The reductions in sensory cortices are thought to reflect plasticity in modality-specific neocortex. Unexpectedly, repetition of auditory stimuli has resulted in reduced activation in multimodal and visual regions, but not in the auditory temporal lobe cortex. This finding puts the coupling of perceptual priming and modality-specific cortical plasticity into question. Here, functional magnetic resonance imaging was used with environmental sounds to reexamine whether auditory priming is associated with reduced activation in the auditory cortex. Participants heard environmental sounds (e.g., animals, machines, musical instruments, etc.) in blocks, alternating between initial and repeated presentations, and decided whether or not each sound was produced by an animal. Repeated versus initial presentations of sounds resulted in repetition priming (faster responses) and reduced activation in the right superior temporal gyrus, bilateral superior temporal sulci, and right inferior prefrontal cortex. The magnitude of behavioral priming correlated positively with reduced activation in these regions. This indicates that priming for environmental sounds is associated with modification of neural activation in modality-specific auditory cortex, as well as in multimodal areas.