Gambling is a naturalistic example of risky decision-making. During gambling, players typically display an array of cognitive biases that create a distorted expectancy of winning. This study investigated brain regions underpinning gambling-related cognitive distortions, contrasting patients with focal brain lesions to the ventromedial prefrontal cortex (vmPFC), insula, or amygdala ("target patients") against healthy comparison participants and lesion comparison patients (i.e., with lesions that spare the target regions). A slot machine task was used to deliver near-miss outcomes (i.e., nonwins that fall spatially close to a jackpot), and a roulette game was used to examine the gambler's fallacy (color decisions following outcome runs). Comparison groups displayed a heightened motivation to play following near misses (compared with full misses), and manifested a classic gambler's fallacy effect. Both effects were also observed in patients with vmPFC and amygdala damage, but were absent in patients with insula damage. Our findings indicate that the distorted cognitive processing of near-miss outcomes and event sequences may be ordinarily supported by the recruitment of the insula. Interventions to reduce insula reactivity could show promise in the treatment of disordered gambling.G ambling is a widespread activity with a lifetime prevalence of 78% in the United States (1) and a past-year prevalence of 73% in the United Kingdom (2). The widespread recognition that "the house always wins," reflecting the negative expected value of gambling, makes gambling an enduring puzzle for psychological and economic models of choice behavior. Cognitive approaches to gambling explain this nonnormative behavior with reference to a number of cognitive distortions and irrational beliefs that occur during gambling play, which cause the gambler to overestimate his likelihood of winning (3, 4). The illusion of control refers to how superficial features of a game, such as a choice or instrumental response, promote erroneous perceptions of skill over outcomes that are determined only by chance (5). Near-miss outcomes (nonwins that fall close to the jackpot) increase motivations to play, plausibly by fueling beliefs about skill acquisition (6). The gambler's fallacy is a bias in the processing of randomness, whereby recent consecutive outcomes are considered less likely to repeat, and conversely, outcomes that have not occurred in the recent history are perceived as "due" (7).These distortions are reliably observed in field studies, e.g., casino environments (8), and are not confined to gambling; illusory control and the gambler's fallacy are observed in stock traders (9), and near misses influence decision-making in occupational settings (10). In the laboratory, these distortions can be elicited with gambling games, allowing the comparison of these biases between different clinical groups. The overall level of distorted thinking is elevated in people with gambling problems (11,12), and these cognitions can be targeted effectively in psy...