Aversive experiences powerfully regulate memory formation, and memory strength is proportional to the intensity of these experiences. Inhibition of the neural circuits that convey aversive signals when they are predicted by other sensory stimuli is hypothesized to set associative memory strength. However, the neural circuit mechanisms that produce this predictive inhibition to regulate memory formation are unknown. Here we show that predictive sensory cues recruit a descending feedback circuit from the central amygdala that activates a specific population of midbrain periaqueductal gray pain-modulatory neurons to control aversive memory strength. Optogenetic inhibition of this pathway disinhibited predicted aversive responses in lateral amygdala neurons, which store fear memories, resulting in the resetting of fear learning levels. These results reveal a control mechanism for calibrating learning signals to adaptively regulate the strength of behavioral learning. Dysregulation of this circuit could contribute to psychiatric disorders associated with heightened fear responsiveness.