The hippocampus is important for spatial navigation. Literature shows that allocentric visual contexts in the animal’s background are critical for making conditional response selections during navigations. In a traditional maze task, however, it is difficult to identify exactly which subsets of visual contexts are critically used. In the current study, we tested in rats whether making conditional response selections required the hippocampus when using computer-generated visual contextual stimuli in the animal’s background as in primate and human studies. We designed a new task, visual contextual response selection (VCRS) task, in which the rat ran along a linear track and encountered a touchscreen monitor at the end of the track. The rat was required to touch one of the adjacent rectangular box images depending on the visual contextual stimuli displayed in the two peripheral monitors positioned on both sides of the center touchscreen monitor. The rats with a GABA-A receptor agonist, muscimol (MUS), infused bilaterally in the dorsal hippocampi showed severe performance deficits in the VCRS task and the impairment was completely reversible with vehicle injections. The impairment in contextual response selection with hippocampal inactivations occurred regardless of whether the visual context was presented in the side monitors or in the center touchscreen monitor. However, when the same visual contextual stimuli were pitted against each other between the two side monitors and as the rats simply ran toward the visual context associated with reward on a T-shaped track, hippocampal inactivations with MUS showed minimal disruptions, if any, in performance. Our results suggest that the hippocampus is critically involved in conditional response selection using visual stimuli in the background, but it is not required for the perceptual discrimination of those stimuli.