Combination antiretroviral therapies have revolutionized the treatment of HIV infection, and many patients now enjoy a lifespan equal to that of the general population. However, HIV-associated neurocognitive disorders (HAND) remain a major health concern, with between 30% and 70% of all HIV-infected patients developing cognitive impairments during their life time. One important feature of HAND is visuo-perceptual deficits, but the systems-level neural dynamics underlying these impairments are poorly understood. In the current study, we use magnetoencephalography and advanced time series analyses to examine these neural dynamics during a visuospatial processing task in a group of HIV-infected patients without HAND (n = 25), patients with HAND (n = 18), and a group of demographically-matched uninfected controls (n = 24). All participants completed a thorough neuropsychological assessment, and underwent magnetoencephalography and structural MRI protocols. In agreement with previous studies, patients with HAND performed significantly worse than HIV-infected patients without HAND and controls on the cognitive task, in terms of increased reaction time and decreased accuracy. Our magnetoencephalography results demonstrated that both spontaneous and neural oscillatory activity within the occipital cortices were affected by HIV infection, and that these patterns predicted behavioural performance (i.e. accuracy) on the task. Specifically, spontaneous neural activity in the alpha (8-16 Hz) and gamma (52-70 Hz) bands during the prestimulus baseline period, as well as oscillatory theta responses (4-8 Hz) during task performance were aberrant in HIV-infected patients, with both spontaneous alpha and oscillatory theta activity significantly predicting accuracy on the task and neuropsychological performance outside of the magnetoencephalography scanner. Importantly, these rhythmic patterns of population-level neural activity also distinguished patients by HAND status, such that spontaneous alpha activity in patients with HAND was elevated relative to HIV-infected patients without HAND and controls. In contrast, HIV-infected patients with and without HAND had increased spontaneous gamma compared to controls. Finally, there was a stepwise decrease in oscillatory theta activity as a function of disease severity, such that the response diminished from controls to patients without HAND to patients with HAND. Interestingly, the strength of the relationship between this theta response and accuracy also dissociated patient groups in a similar manner (controls > HIV with no HAND > HIV with HAND), indicating a reduced coupling between neurophysiology and behaviour in HIV-infected patients. This study provides the first neuroimaging evidence of a dissociation between HIV-infected patients with and without HAND, and these findings shed new light on the neural bases of cognitive impairment in HIV infection.