We explore to what extent the combination of predictive and interpretable modeling can provide new insights for functional brain imaging. For this, we apply a recently introduced regularized regression technique, the Elastic Net, to the analysis of the PBAIC 2007 competition data. Elastic Net regression controls via one parameter the number of voxels in the resulting model, and via another the degree to which correlated voxels are included. We find that this method produces highly predictive models of fMRI data that provide evidence for the distributed nature of neural function. We also use the flexibility of Elastic Net to demonstrate that model robustness can be improved without compromising predictability, in turn revealing the importance of localized clusters of activity. Our findings highlight the functional significance of patterns of distributed clusters of localized activity, and underscore the importance of models that are both predictive and interpretable.