Anxiety disorders are commonly associated with increased generalization of fear from a stress- or trauma-associated environment to a neutral context or environment. Differences in context-associated memory in males and females may contribute to increased susceptibility to anxiety disorders in women. Here we examined sex differences in context fear generalization and its neural correlates. We observed stronger context fear conditioning and more generalization of fear to a similar context in females than males. In addition, context preexposure increased fear conditioning in males and decreased generalization in females. Accordingly, males showed stronger cFos activity in dorsal hippocampus during memory retrieval and context generalization, whereas females showed preferential recruitment of basal amygdala. Together, these findings are consistent with previous research showing that hippocampal activity correlates with reduced context fear generalization. Differential competition between hippocampus and amygdala-dependent processes may thus contribute to sex differences in retrieval of context fear and greater generalization of fear-associated memory.