The present study was designed to test a hypothesis that functional magnetic resonance imaging (fMRI) can be used to monitor functional impairment and recovery after moderate experimental traumatic brain injury (TBI). Moderate TBI was induced by lateral fluid percussion injury in adult rats. The severity of brain damage and functional recovery in the primary somatosensory cortex (S1) was monitored for up to 56 days using fMRI, cerebral blood flow (CBF) by arterial spin labeling, local field potential measurements (LFP), behavioral assessment, and histology. All the rats had reduced blood-oxygen-level-dependent (BOLD) responses during the 1st week after trauma in the ipsilateral S1. Forty percent of these animals showed recovery of the BOLD response during the 56 day follow-up. Unexpectedly, no association was found between the recovery in BOLD response and the volume of the cortical lesion or thalamic neurodegeneration. Instead, the functional recovery occurred in rats with preserved myelinated fibers in layer VI of S1. This is, to our knowledge, the first study demonstrating that fMRI can be used to monitor post-TBI functional impairment and consequent spontaneous recovery. Moreover, the BOLD response was associated with the density of myelinated fibers in the S1, rather than with neurodegeneration. The present findings encourage exploration of the usefulness of fMRI as a noninvasive prognostic biomarker for human post-TBI outcomes and therapy responses.