Incidental learning of phonological structures through repeated exposure is an important component of native and foreign-language vocabulary acquisition that is not well understood at the neurophysiological level. It is also not settled when this type of learning occurs at the level of word forms as opposed to phoneme sequences. Here, participants listened to and repeated back foreign phonological forms (Korean words) and new native-language word forms (Finnish pseudowords) on two days. Recognition performance was improved, repetition latency became shorter and repetition accuracy increased when phonological forms were encountered multiple times. Cortical magnetoencephalography responses occurred bilaterally but the experimental effects only in the left hemisphere. Superior temporal activity at 300–600 ms, probably reflecting acoustic-phonetic processing, lasted longer for foreign phonology than for native phonology. Formation of longer-term auditory-motor representations was evidenced by a decrease of a spatiotemporally separate left temporal response and correlated increase of left frontal activity at 600–1200 ms on both days. The results point to item-level learning of novel whole-word representations.