Perceptual expectations can change how a visual stimulus is perceived. Recent studies have shown mixed results in terms of whether expectations modulate sensory representations. Here we used a statistical learning paradigm to study the temporal characteristics of perceptual expectations. We presented participants with pairs of object images organized in a predictive manner, and then recorded their brain activity with MEG while they viewed expected and unexpected image pairs on the subsequent day. We observed stronger alpha-band (7–14 Hz) activity in response to unexpected compared to expected object images. Specifically, the alpha-band modulation occurred as early as the onset of the stimuli, and was most pronounced in left occipito-temporal cortex. Given that the differential response to expected versus unexpected stimuli occurred in sensory regions early in time, our results suggest that expectations modulate perceptual decision making by changing the sensory response elicited by the stimuli.