Movement of the body, head, or eyes with respect to the world creates one of the most common yet complex situations in which the visuomotor system must localize objects. In this situation, vestibular, proprioceptive, and extra-retinal information contribute to accurate visuomotor control. The utility of retinal motion information, on the other hand, is questionable, since a single pattern of retinal motion can be produced by any number of head or eye movements. Here we investigated whether retinal motion during a smooth pursuit eye movement contributes to visuomotor control. When subjects pursued a moving object with their eyes and reached to the remembered location of a separate stationary target, the presence of a moving background significantly altered the endpoints of their reaching movements. A background that moved with the pursuit, creating a retinally stationary image (no retinal slip), caused the endpoints of the reaching movements to deviate in the direction of pursuit, overshooting the target. A physically stationary background pattern, however, producing retinal image motion opposite to the direction of pursuit, caused reaching movements to become more accurate. The results indicate that background retinal motion is used by the visuomotor system in the control of visually guided action.