Emotional memories are preferentially consolidated during sleep, through the process of memory reactivation. Targeted memory reactivation (TMR) has been shown to boost memory consolidation during sleep, but its neural correlates remain unclear, particularly for emotional memories. Here, we aimed to examine how TMR of emotional material during slow wave sleep (SWS) impacts upon neural processing during a subsequent arousal rating task. Participants were trained on a spatial memory task including negative and neutral pictures paired with semantically matching sounds. The picture-sound pairs were rated for emotional arousal before and after the spatial memory task. Then, half of the sounds from each emotional category (negative and neutral) were cued during SWS. The next day, participants were retested on both the arousal rating and the spatial memory task inside an MRI scanner, followed by another retest session a week later. Memory consolidation and arousal processing did not differ between cued and non-cued items of either emotional category. We found increased responses to emotional stimuli in the amygdala and orbitofrontal cortex (OFC), and a cueing versus emotion interaction in the OFC, whereby cueing neutral stimuli led to an increase in OFC activity, while cueing negative stimuli led to decreased OFC activation. Interestingly, the effect of cueing on amygdala activation was modulated by time spent in REM sleep. We conclude that SWS TMR impacts OFC activity, while REM sleep plays a role in mediating the effect of such cueing on amygdala.