Risk avoidance is an important determinant of human behavior. The neurotransmitter serotonin has been implicated in processing negative outcomes caused by risky decisions. However, it is unclear whether serotonin provides a neurobiological link between making a risk aversive decision and the response to a negative outcome. Using pharmacological fMRI, we manipulated the availability of serotonin in healthy volunteers while performing a gambling task. The same group of participants was studied in three fMRI sessions: (i) during intravenous administration of the SSRI citalopram to increase the serotonergic tone, (ii) after acute tryptophan depletion (ATD) to reduce central serotonin levels, or (iii) without interventions. ATD and citalopram had opposite effects on outcome related activity in dorsomedial prefrontal cortex (dmPFC) and amygdala. Relative to the control condition, ATD increased and citalopram decreased the neural response to negative outcomes in dmPFC. Conversely, ATD decreased and citalopram increased the neural response to negative outcomes in left amygdala. Critically, these pharmacological effects were restricted to negative outcomes that were caused by low-risk decisions and led to a high missed reward. ATD and citalopram did not alter the neural response to positive outcomes in dmPFC, but relative to ATD, citalopram produced a bilateral increase in the amygdala response to large wins caused by high-risk choices. The results show a selective involvement of the serotonergic system in neocortical processing of negative outcomes resulting from risk-averse decisions, thereby linking risk aversion and processing of negative outcomes in goal-directed behaviors.