How an object is perceived depends on the temporal context in which it is encountered. Sensory signals in the brain also depend on temporal context, a phenomenon often referred to as adaptation. Traditional descriptions of adaptation effects emphasize various forms of response fatigue in single neurons, which grow in strength with exposure to a stimulus. Recent work on vision, and other sensory modalities, has shown that this description has substantial shortcomings. Here we review our emerging understanding of how adaptation alters the balance between excitatory and suppressive signals, how effects depend on adaptation duration, and how adaptation influences representations that are distributed within and across multiple brain structures. This work points to a sophisticated set of mechanisms for adjusting to recent sensory experience, and suggests new avenues for understanding their function.