Flexible behavior depends on the ability to shift an internal cognitive set as soon as external demand changes. According to neuropsychological studies in human and nonhuman primates, selective lesion to the PFC impairs flexible behavioral shifting. Our previous fMRI study demonstrated that the prefrontal regions showed transient activation related to set shifting in humans and monkeys. To investigate the underlying neural processing, we recorded single-unit activities while monkeys performed a cognitive-set-shifting task, which required shifting between shape-matching and color-matching behaviors. We identified a group of neurons in the inferior arcuate region that exhibited selective activity when the monkeys were required to shift their cognitive set. These shift-related neurons were localized in the focal area along the posterior bank of the inferior arcuate sulcus. Reversible inactivation of this area ipsilateral to the response hand with a small volume of muscimol (even with 0.5 μl) selectively impaired the performance of behavioral shifting. Moreover, this selective behavioral impairment strongly correlated with the dose of muscimol. These results demonstrated localized neural processing for cognitive set shifting and its causal role for behavioral flexibility in primates.