It has been argued that the hippocampus supports cognition by virtue of its role in flexibly binding together distinct elements of experience. Such ‘relational processing’ enables us to (re)construct episodic representations of real or imagined events. The present study examined whether hippocampally mediated relational processing also contributes to the construction of semantic representations. To do so, we asked amnesic individuals with medial temporal lobe (MTL) lesions including the hippocampus to generate hypothetical meanings for novel word compounds (e.g., cactus carpet), a task that requires existing concepts to be flexibly linked. The quality of definitions and number of features generated for the novel compounds were lower in patients with MTL lesions than in control participants. Whereas the subset of patients with lesions extending into lateral temporal cortex had additional difficulty generating meanings for pre‐existing compounds (e.g., bus station), patients with lesions limited to the MTL showed no such deficit, indicating that their impairment in the novel compound condition was not due to reduced access to semantic information. These findings suggest that the role of hippocampally mediated relational processing extends beyond the episodic domain to include the generation of novel semantic representations.