Many animals estimate their self-motion and the movement of external objects by exploiting panoramic patterns of visual motion. To probe how visual systems process compound motion patterns, superimposed visual gratings moving in different directions, plaid stimuli, have been successfully used in vertebrates. Surprisingly, nothing is known about how visually guided insects process plaids. Here, we explored in the blowfly how the well characterized yaw optomotor reflex and the activity of identified visual interneurons depend on plaid stimuli. We show that contrary to previous expectations, the yaw optomotor reflex shows a bimodal directional tuning for certain plaid stimuli. To understand the neural correlates of this behavior, we recorded the responses of a visual interneuron supporting the reflex, the H1 cell, which was also bimodally tuned to the plaid direction. Using a computational model, we identified the essential neural processing steps required to capture the observed response properties. These processing steps have functional parallels with mechanisms found in the primate visual system, despite different biophysical implementations. By characterizing other visual neurons supporting visually guided behaviors, we found responses that ranged from being bimodally tuned to the stimulus direction (component-selective), to responses that appear to be tuned to the direction of the global pattern (pattern-selective). Our results extend the current understanding of neural mechanisms of motion processing in insects, and indicate that the fly employs a wider range of behavioral responses to multiple motion cues than previously reported.