Neurons in the primary visual cortex, V1, are specialized for the processing of elemental features of the visual stimulus, such as orientation and spatial frequency. Recent fMRI evidence suggest that V1 neurons are also recruited in visual perceptual memory; a number of studies using multi-voxel pattern analysis have successfully decoded stimulus-specific information from V1 activity patterns during the delay phase in memory tasks. However, consistent fMRI signal modulations reflecting the memory process have not yet been demonstrated. Here, we report evidence, from three subjects, that the low V1 BOLD activity during retention of low-level visual features is caused by competing interactions between neural populations coding for different values along the spectrum of the dimension remembered. We applied a memory masking paradigm in which the memory representation of a masker stimulus interferes with a delayed spatial frequency discrimination task when its frequency differs from the discriminanda with ±1 octave and found that impaired behavioral performance due to masking is reflected in weaker V1 BOLD signals. This cross-channel inhibition in V1 only occurs with retinotopic overlap between the masker and the sample stimulus of the discrimination task. The results suggest that memory for spatial frequency is a local process in the retinotopically organized visual cortex.