When meaningful stimuli such as words are encountered in groups or pairs (e.g., “elephant‐ferry”), they can be processed either separately or as an integrated concept (“an elephant ferry”). Prior research suggests that memory for integrated associations is supported by different mechanisms than is memory for nonintegrated associations. However, little is known about the neurocognitive mechanisms that support the integration of novel stimulus pairs. We recorded ERPs while participants memorized sequentially presented, unrelated noun pairs using a strategy that either did or did not involve attempting to construct coherent definitions. We varied the concreteness of the first noun in each pair to examine whether conceptual combination instructions would induce compositional concreteness effects, or differences in ERPs evoked by the second noun as a function of the concreteness of the first noun. We found that the conceptual combination task, but not the noncombinatory encoding task, produced compositional concreteness effects on a late frontal negativity previously linked to visual imagery. Moreover, word pairs studied under conceptual combination instructions showed evidence of more unitized or holistic memory representations on associative recognition and free recall tests. Finally, item analyses indicated that (a) items with higher normed imageability ratings were rated by participants as easier to conceptually combine, and (b) in the conceptual combination task, ease‐of‐combination ratings mediated an indirect relationship between imageability and subsequent associative memory. These data are suggestive of a role of compositional imagery in the online formation of novel concepts via conceptual combination.