According to hierarchical predictive coding models, the cortex constantly generates predictions of incoming stimuli at multiple levels of processing. Responses to auditory mismatches and omissions are interpreted as reflecting the prediction error when these predictions are violated. An alternative interpretation, however, is that neurons passively adapt to repeated stimuli. We separated these alternative interpretations by designing a hierarchical auditory novelty paradigm and recording human EEG and magnetoencephalographic (MEG) responses to mismatching or omitted stimuli. In the crucial condition, participants listened to frequent series of four identical tones followed by a fifth different tone, which generates a mismatch response. Because this response itself is frequent and expected, the hierarchical predictive coding hypothesis suggests that it should be cancelled out by a higher-order prediction. Three consequences ensue. First, the mismatch response should be larger when it is unexpected than when it is expected. Second, a perfectly monotonic sequence of five identical tones should now elicit a higher-order novelty response. Third, omitting the fifth tone should reveal the brain's hierarchical predictions. The rationale here is that, when a deviant tone is expected, its omission represents a violation of two expectations: a local prediction of a tone plus a hierarchically higher expectation of its deviancy. Thus, such an omission should induce a greater prediction error than when a standard tone is expected. Simultaneous EEE-magnetoencephalographic recordings verify those predictions and thus strongly support the predictive coding hypothesis. Higher-order predictions appear to be generated in multiple areas of frontal and associative cortices. mismatch negativity | P300 component