Making an error triggers a host of cognitive and behavioral adjustments theorized to boost task engagement and facilitate learning. Yet how errors influence memory formation – a cognitive process foundational to learning – remains unknown. Adaptive cognitive accounts of error processing propose that errors increase arousal, taskengagement, and attention, and should therefore enhance subsequent memory formation. Conversely, nonadaptive accounts of error processing and related research in arousal-mediated memory selectivity predict that errors could impair subsequent memory formation. We tested these divergent predictions in two experiments. In experiment 1, participants categorized trial-unique images as ‘living’ or ‘nonliving’, and following a short delay, performed a surprise recognition memory task. In contrast to what adaptive cognitive accounts of error processing would predict, people formed memories more poorly after errors, even when performance after errors was accurate. In experiment 2, we asked whether poorer memory formation after errors correlated with arousal or visual engagement after errors. Participants performed a modified Simon task in which they categorized trialunique images as ‘natural’ or ‘man-made’, while we recorded pupil dilation and visual fixations. Recognition memory was subsequently tested. We found that people who encoded memories more poorly after errors had larger pupillary responses to errors and spent less time fixating on stimuli after errors relative to before. Our results support non-adaptive theories of error processing by showing that errors transiently impair memory formation, possibly by increasing arousal and capturing attention.