We have previously shown that activity and connectivity within and between the action observation and mentalizing brain systems reflect the degree of positive dimensions expressed by social interactions such as cooperativity and affectivity, respectively. Here we aim to extend this evidence by investigating the neural bases of processing negative dimensions of observed interactions, such as competition and affective conflict, possibly representing a benchmark for different pathological conditions. In this fMRI study 34 healthy participants were shown pictures depicting interactions characterized by two crossed dimensions, i.e. positively- vs. negatively- connotated social intentions mainly expressed in terms of motor acts vs. mental states, i.e. cooperative, competitive, affective and conflicting interactions. We confirmed the involvement of the action observation and mentalizing networks in processing intentions mainly expressed through motor acts (cooperative/competitive) vs. mental states (affective/conflicting), respectively. Results highlighted the selective role of the left pSTS/TPJ in decoding social interactions, even when compared with parallel actions by non-interacting individuals. Its right-hemispheric homologue displayed stronger responses to negative than positive social intentions, regardless of their motor/mental status, and decreased connectivity with the medial prefrontal cortex (mPFC) when processing negative interactions. The resulting mPFC downregulation by negative social scenes might reflect an adaptive response to socio-affective threats, via decreased mentalizing when facing negative social stimuli. This evidence on the brain mechanisms underlying the decoding of real complex interactions represents a baseline for assessing both the neural correlates of impaired social cognition, and the effects of rehabilitative treatments, in neuro-psychiatric diseases or borderline conditions such as loneliness.