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An electronic embodiment of a neural network based associative memory in the form of a binary connection matrix is described. The nature of false memory errors, their effect on the information storage capacity of binary connection matrix memories, and a novel technique to eliminate such errors with the help of asymmetrical extra connections are discussed. The stability of the matrix memory system incorporating a unique local inhibition scheme is analyzed in terms of local minimization of an energy function. The memory's stability, dynamic behavior, and recall capability are investigated using a 32-"neuron" electronic neural network memory with a 1024-programmable binary connection matrix.