The research presented in this habilitation treatise seeks to understand the construction of unambiguous conscious experiences from ambiguous sensory information. Our work builds on the idea that the brain applies predictive processes to resolve the ambiguity inherent in sensory information. We developed a predictive coding algorithm that models the interaction of internal predictions with prediction errors driven by ambiguous sensory information. We combined model-based fMRI and TMS-induced virtual lesions to demonstrate that the processing of sensory ambiguity is not limited to feature-selective regions in sensory corteces, but involves supra-modal brain regions of the frontoparietal network. Our work proposes a key role for the inferior frontal cortex in regulating the access of conflicting information into conscious experience. Finally, we show that the interaction of internal predictions with external sensory information correlates with the severity of hallucinatory experiences in patients diagnosed with paranoid schizophrenia. In sum, the research presented in this habilitation treatise explains how the brain transforms ambiguous sensory data into unambiguous conscious experiences and suggests how alterations in this process may lead to hallucinations. Our computational and lesion-based approach advances the scientific understanding at two of the most important frontiers in contemporary neuroscience: the biology of consciousness and neurocomputational theories of psychosis.