This study investigated the role of bottom-up and top-down neural mechanisms in the processing of emotional face expression during memory formation. Functional brain imaging data was acquired during incidental learning of positive ("happy"), neutral and negative ("angry" or "fearful") faces. Dynamic Causal Modeling (DCM) was applied on the functional magnetic resonance imaging (fMRI) data to characterize effective connectivity within a brain network involving face perception (inferior occipital gyrus and fusiform gyrus) and successful memory formation related areas (hippocampus, superior parietal lobule, amygdala, and orbitofrontal cortex). The bottom-up models assumed processing of emotional face expression along feed forward pathways to the orbitofrontal cortex. The top-down models assumed that the orbitofrontal cortex processed emotional valence and mediated connections to the hippocampus. A subsequent recognition memory test showed an effect of negative emotion on the response bias, but not on memory performance. Our DCM findings showed that the bottom-up model family of effective connectivity best explained the data across all subjects and specified that emotion affected most bottom-up connections to the orbitofrontal cortex, especially from the occipital visual cortex and superior parietal lobule. Of those pathways to the orbitofrontal cortex the connection from the inferior occipital gyrus correlated with memory performance independently of valence. We suggest that bottom-up neural mechanisms support effects of emotional face expression and memory formation in a parallel and partially overlapping fashion.