Despite its widespread use, a striking lack of knowledge exists regarding the mechanism of action of transcranial magnetic stimulation (TMS). This thesis describes the physiological characterisation of repetitive TMS (rTMS) to the motor system by means of functional magnetic resonance imaging (fMRI). A detailed analysis of imaging artefacts arising from the simultaneous application of TMS-fMRI was conducted and subsequently, strategies were presented for unperturbed TMS-fMRI. Physiological responses during subthreshold high-frequency rTMS of the primary sensorimotor cortex (Ml/Sl) were visualised within distinct cortical motor regions, comprising PMd, SMA, and contralateral Ml/Sl, while no significant responses were evidenced in the area of stimulation. Repetitive TMS during or before motor behaviour illustrated the context- dependence of rTMS-induced activity changes. The first demonstration of TMS-fMRI at 3 Tesla provided evidence that subthreshold rTMS can activate distinct networks including subcortical motor regions. The subthreshold nature of rTMS was confirmed by simultaneous electromyographic recordings from the target muscle. Stimulation of the dorsal premotor cortex provided evidence that rTMS- evoked local activity changes depend on the input function. The capability of TMS to target distinct networks in the human brain was confirmed. TMS targets a set of cortical and subcortical structures. Local responses may not invariably be elicited, indicating that low levels of synaptic activity, as occurring at low-intensity stimulation, do not necessarily evoke corresponding changes in cortical haemodynamics. It is concluded that combined TMS-fMRI offers a means to assess the mechanism of action of TMS at high spatial and temporal resolution