Encoding often occurs in social contexts, yet research has hardly addressed their role in verbal memory. In three experiments, we investigated the behavioral and neural effects of encoding context on memory for positive, negative, and neutral adjectives, contrasting a social-feedback group (N = 24) with an explicit verbal-learning (N = 24) and a levels-of-processing group (N = 24). Participants in the social-feedback group were not aware of a recognition session one week later, but their memory was better than the explicit learning or the levels-of-processing groups'. However, they also exhibited the strongest response bias, particularly for positive words. Brain event-related potentials (ERPs) revealed largest early negativities (EPN) and late positivities (LPP) in the social-feedback group. Only in the subsequent slow-wave did the explicit learning group show higher amplitudes than the other two groups, suggesting reliance on strategic rather than automatic processes. Still, context-driven incidental encoding outweighed explicit instructions, specifying a decisive role of social factors in memory.