The ability to remember episodic details of prior events declines with normal aging. The present study aimed at determining whether these declines are restricted to verbatim traces of items per se or extend to gist traces of their meaning. Younger (n = 63) and older adults (n = 46) studied a list including related (strong gist activation) and unrelated words (weak gist activation) and performed a recognition test consisting of targets, related distractors, and unrelated distractors. Gist memory increased in the strong relative to the weak gist condition in both age groups. Whereas both younger and older adults could retrieve gist traces of target words, older adults were impaired in their ability to retrieve their verbatim traces resulting in increased false recognition of related distractors. These findings suggest an age-related decrease in the ability to retrieve verbatim details of past episodes accompanied by an increase in reliance on gist memory.