Regional differences in large-scale connectivity have been proposed to underlie functional specialization along the anterior–posterior axis of the medial temporal lobe (MTL), including the hippocampus (HC) and the parahippocampal gyrus (PHG). However, it is unknown whether functional connectivity (FC) can be used reliably to parcellate the human MTL. The current study aimed to differentiate subregions of the HC and the PHG based on patterns of whole-brain intrinsic FC. FC maps were calculated for each slice along the longitudinal axis of the PHG and the HC. A hierarchical clustering algorithm was then applied to these data in order to group slices according to the similarity of their connectivity patterns. Surprisingly, three discrete clusters were identified in the PHG. Two clusters corresponded to the parahippocampal cortex (PHC) and the perirhinal cortex (PRC), and these regions showed preferential connectivity with previously described posterior-medial and anterior-temporal networks, respectively. The third cluster corresponded to an anterior PRC region previously described as area 36d, and this region exhibited preferential connectivity with auditory cortical areas and with a network involved in visceral processing. The three PHG clusters showed different profiles of activation during a memory-encoding task, demonstrating that the FC-based parcellation identified functionally dissociable sub-regions of the PHG. In the hippocampus, no sub-regions were identified via the parcellation procedure. These results indicate that connectivity-based methods can be used to parcellate functional regions within the MTL, and they suggest that studies of memory and high-level cognition need to differentiate between PHC, posterior PRC, and anterior PRC.