The brain has the extraordinary capacity to construct predictive models of the environment by internalizing statistical regularities in the sensory inputs. The resulting sensory expectations shape how we perceive and react to the world; at the neural level, this relates to decreased neural responses to expected than unexpected stimuli (‘expectation suppression’). Crucially, expectations may need revision as context changes. However, existing research has often neglected this issue. Further, it is unclear whether contextual revisions apply selectively to expectations relevant to the task at hand, hence serving adaptive behaviour. The present fMRI study examined how contextual visual expectations spread throughout the cortical hierarchy as participants update their beliefs. We created a volatile environment with two state spaces presented over separate contexts and controlled by an independent contextualizing signal. Participants attended a training session before scanning to learn contextual temporal associations among pairs of object images. The fMRI experiment then tested for the emergence of contextual expectation suppression in two separate tasks, respectively with task-relevant and task-irrelevant expectations. Behavioural and neural effects of contextual expectation emerged progressively across the cortical hierarchy as participants attuned themselves to the context: expectation suppression appeared first in the insula, inferior frontal gyrus and posterior parietal cortex, followed by the ventral visual stream, up to early visual cortex. This applied selectively to task-relevant expectations. Taken together, the present results suggest that an insular and frontoparietal executive control network may guide the flexible deployment of contextual sensory expectations for adaptive behaviour in our complex and dynamic world.