Positive affective touch plays a central role in social and inter-personal interactions. Low-threshold mechanoreceptive afferents, including slowly-conducting C-tactile (CT) afferents found in hairy skin, transmit such signals from gentle touch to the brain. Tactile signals are processed, in part, by the posterior insula, where it is the thought to be the primary target for CTs. We used magnetoencephalography (MEG) to assess brain activity evoked by gentle, naturalistic stroking touch on the arm delivered by a new MEG-compatible brush robot. We aimed to use high temporal resolution MEG to allow us to distinguish between brain responses from fast-conducting Aβ and slowly-conducting CT afferents. Brush strokes were delivered to the left upper arm and left forearm of 15 healthy participants. We hypothesized that late brain responses, due to slow CT afference, would appear with a time shift between the two different locations on the arm. Our results show that gentle touch rapidly activated somatosensory, motor, and cingulate regions within the first 100 ms of skin contact, which was driven by fast-conducting mechanoreceptive afference, and that these responses were sustained during touch. Peak latencies in the posterior insula were shifted as a function of stimulus location and temporally-separate posterior insula activations were induced by Aβ and CT afference that may modulate the emotional processing of gentle touch on hairy skin. We conclude that the detailed information regarding temporal and spatial brain activity from MEG provides new insights into the central processing of gentle, naturalistic touch, which is thought to underpin affective tactile interactions.