This is something I've struggled with so I thought I'd chime in an relay my experience.

Mike mentioned repetition...repetition is king!! For me, there is no substitute for tons of reps. For me to really memorize a challenging song, I can't tell you how many times I have to play it...at least 50 times, probably more like 100. A "memorized" song for me is on that is in muscle memory. There are songs I play in my band that I would have to stop and think to tell you what the chords are. I go on auto pilot and my fingers just go where they need to go and my ears tell me if I'm off or not.

I've learned songs to record as part of a collaboration. I will learn them well, but once they are recorded and I don't play them anymore, they become quickly forgotten. As Mike mentioned, if I chose to relearn them, they would come back quickly.

In my band, I have a book of "cheat sheets" listing chords for various parts. Even after a year of playing with them, I still have to follow some of the sheets closely. As time goes on, I become less and less dependant on that book.

Song form can be a struggle too...how long are the verses and choruses, what are the variations, etc. With repetition, you will start to feel where the transitions are. When I first started paying in a band, I would worry about missing a cue for a solo. Over time I've found that I'll feel or sense it coming.

I've been playing for 30 years...seriously for the last 15 or so...and I STILL have a bit of a "duh" moment if somebody hits me with the "hey, play something for me" bit.

Just keep playing, and playing, and playing....then play some more, and it will start to stick and become a natural extension of you.

One last thing...don't worry about exact replication of strumming patterns, rhythmic phrasing, sometimes even note selection. If you strive for exact replication, you will be paralyzed and make little progress. You want to be close and capture the overall idea for sure. For example, if you decide to play "Hard to Handle" for somebody, don't beat yourself up if you miss some of the funky rhythm or slop up a few notes in the solo. You don't want to be sloppy...but you don't need to parrot the original recording either. If you watch some players, you'll find that even they don't always replicate their own original recording exactly. So cut yourself some slack there :).