Empathy is thought to engage mental simulation, which in turn is known to rely on hippocampal-neocortical processing. Here, we tested how hippocampal-neocortical pattern similarity and connectivity contributed to pain empathy. Using this approach, we analyzed a data set of 102 human participants who underwent functional MRI while painful and non-painful electrical stimulation was delivered to themselves or to a confederate. As hypothesized, results revealed increased pattern similarity between first-hand pain and pain empathy (compared to non-painful control conditions) within the hippocampus, retrosplenial cortex, the temporo-parietal junction and anterior insula. While representations in these regions were unaffected by confederate similarity, pattern similarity in the dorsal medial prefrontal cortex was increased the more dissimilar the other individual was perceived. Hippocampal-neocortical connectivity during first-hand pain and pain empathy engaged largely distinct but neighboring primary motor regions, and empathy-related hippocampal coupling with the fusiform gyrus positively scaled with trait measures of perspective taking. These findings suggest that shared representations and mental simulation might contribute to pain empathy via hippocampal-neocortical pattern similarity and connectivity, partially affected by personality traits and the similarity of the observed individual.