James M. Lampinen, an assistant professor of psychology at the University of Arkansas, supplies the following answer:
Déjà vu is a strong sense of global familiarity that occurs in a seemingly novel situation. The familiarity experienced in déjà vu is global in that it seems as if the entire event--every detail--has happened before, despite the knowledge that the event is unique. The experience is frequently disconcerting and is often accompanied by a sense of unreality. Most people experience déjà vu at some point in their lives--surveys indicate that a majority of respondents have experienced at least one episode of déjà vu.
We don't yet have a definitive account of the mechanisms that produce déjà vu but a number of theoretical approaches have been advanced. Sigmund Freud, the developer of psychoanalysis, proposed that déjà vu happens when a person is spontaneously reminded of an unconscious fantasy. Because it is unconscious, the content of the fantasy is blocked from awareness, but the sense of familiarity leaks through and results in the déjà vu experience.
More recently déjà vu has been explained in terms of information processing. For instance, Herman Sno, one of the world's leading experts on the topic, has proposed that memories are stored in a format that is similar to that used to store holographic images. Most people think about holography as a way of creating cool 3D images and as an excuse to play with laser beams. But the aspect of holography that is central to Sno's thesis is how holograms store information. In particular, Sno points out that unlike traditional photography, each section of a hologram contains all the information needed to produce the entire picture. The smaller the section one uses, however, the less precise (and fuzzier) the resultant image becomes. According to Sno, human memory works in an analogous way. Déjà vu experiences occur when one¿s current situation spuriously matches one of these fuzzy images of a past event. It's rather like convincing yourself that you recognize the person in a blurry security camera picture.
It is also possible to explain déjà vu in terms of global matching models of memory. According to these models, a situation can seem familiar for one of two reasons. It may seem familiar because it is extremely similar to a single event stored in memory. But a situation can also seem familiar if it is moderately similar to a large number of events stored in memory. For instance, imagine you are in an experiment in which you are shown pictures of various people in my family: my brothers John and Joe, my sisters Sharon, Linda and Judi, my parents Walter and Patricia, and so on. Now as you're walking out of the experiment you happen to bump into me. You might have the experience of seeing me and thinking to yourself, "Hey, that guy looks familiar." The reason for this is that although nobody in my family looks exactly like me (the poor devils) they all look somewhat like me and according to global matching models the similarity tends to summate. Some experiences of déjà vu could be explained in a similar way.
Progress toward understanding déjà vu has also been made in the neurosciences. In particular, researchers in both cognitive psychology and the neurosciences have distinguished between memories that are based on conscious recollection and memories that are based on familiarity. For instance, most people are able to consciously recollect their first kiss. They can mentally put themselves back into the context of that event (sigh). But we've also all had the experience of knowing we've met someone before, but not knowing quite where. The person is familiar but we can't quite place them. Researchers believe that a memory system that includes the prefrontal cortex and the hippocampus mediates conscious recollection whereas a memory system that includes the parahippocampal gyrus and its cortical connections mediates feelings of familiarity. Josef Spatt has recently argued that déjà vu experiences occur when the parahippocampal gyrus and associated areas become temporarily activated in the presence of normal functioning in the prefrontal cortex and hippocampus. This produces a strong feeling of familiarity but without the experience of conscious recollection.
As you can probably tell, there are a number of different theories attempting to explain déjà vu, but we don't yet have a definitive answer as to which of those theories is correct. This is an area still ripe for explanation and continued research.
"Creating False Memories," by Elizabeth F. Loftus, (Scientific American, September 1997) is available for purchase from the Scientific American Archive.