Passive observation of motor actions induces cortical activity in the primary motor cortex (M1) of the onlooker, which could potentially contribute to motor learning. While recent studies report modulation of motor performance following action observation, the neurophysiological mechanism supporting these behavioral changes remains to be specifically defined. Here, we assessed whether the observation of a repetitive thumb movement--similarly to active motor practice--would inhibit subsequent long-term potentiation-like (LTP) plasticity induced by paired-associative stimulation (PAS). Before undergoing PAS, participants were asked to either 1) perform abductions of the right thumb as fast as possible; 2) passively observe someone else perform thumb abductions; or 3) passively observe a moving dot mimicking thumb movements. Motor evoked potentials (MEP) were used to assess cortical excitability before and after motor practice (or observation) and at two time points following PAS. Results show that, similarly to participants in the motor practice group, individuals observing repeated motor actions showed marked inhibition of PAS-induced LTP, while the "moving dot" group displayed the expected increase in MEP amplitude, despite differences in baseline excitability. Interestingly, LTP occlusion in the action-observation group was present even if no increase in cortical excitability or movement speed was observed following observation. These results suggest that mere observation of repeated hand actions is sufficient to induce LTP, despite the absence of motor learning.