Efficient neural processing depends on regulating responses through suppression and facilitation of neural activity. Utilizing a well-known visual motion paradigm that evokes behavioral suppression and facilitation, and combining 5 different methodologies (behavioral psychophysics, computational modeling, functional MRI, pharmacology, and magnetic resonance spectroscopy), we provide evidence that challenges commonly held assumptions about the neural processes underlying suppression and facilitation. We show that: 1) both suppression and facilitation can emerge from a single, computational principle - divisive normalization; there is no need to invoke separate neural mechanisms, 2) neural suppression and facilitation in the motion-selective area MT mirror perception, but strong suppression also occurs in earlier visual areas, and 3) suppression is not primarily driven by GABA-mediated inhibition. Thus, while commonly used spatial suppression paradigms may provide insight into neural response magnitudes in visual areas, they should not be used to infer neural inhibition.