Although Japanese Encephalitis (JE) and Wilson's disease (WD) are different entities, MR findings in both these conditions are quite similar. The purpose of this retrospective study was to find out the similarities and differences between JE and WD on MR imaging. The study group comprised 25 proven cases of JE and 10 cases of WD. Spin echo (SE) TI- and T2-weighted imaging was performed on a 1.5-T MR system. Fourteen of these 35 cases (10 JE, 4 WD) were also examined using T1-weighted magnetization transfer (MT) SE sequence before and after contrast administration. Although both JE and WD showed similar topographical distribution of lesions, predominant involvement of the basal ganglia and thalami, there were some differences. Brain stem lesion was more frequent for WD than for JE, and posteromedial part of the thalami was spared in WD. The lesion characteristics were also different between both; in WD mixed intensity in the basal ganglia and hyperintense linear rim at the peripheral putamen was observed frequently, whereas hyperintense basal ganglia on T2-weighted images, subacute hemorrhage in the thalami and meningeal enhancement were seen only in the patients with JE. These characteristic lesion criteria may help in differentiation of JE from WD on MR imaging.