Until recently, the dominant view was that schizophrenia patients have limited, if any, neuropsychological impairments, and those that are observed are only secondary to the florid symptoms of the disorder. This view has dramatically changed. This review integrates recent evidence demonstrating the severity and profile of neuropsychological impairments in schizophrenia. We present quantitative evaluation of the literature demonstrating that the most severe impairments are apparent in episodic memory and executive control processes, evident on a background of a generalized cognitive deficit. The neuropsychological impairments potentially represent genetic liability to the disorder, as similar, yet milder, impairments are evident in schizophrenia patients even before the onset of psychotic symptoms, as well as in the nonpsychotic relatives of schizophrenia patients. Corresponding cognitive neuroimaging literature on executive functions, episodic memory, and working memory in schizophrenia documenting abnormalities in frontal and medial temporal lobes is summarized, and current models integrating neuropsychological and neuroimaging data are discussed.