Objective: The authors examined brain activity associated with the internal monitoring of performance to test the hypothesis that error-related activity in the anterior cingulate cortex is impaired in patients with schizophrenia. Method: Seventeen patients with schizophrenia and 16 healthy comparison subjects underwent event-related functional magnetic resonance imaging during a continuous performance task; stimulus degradation was used to increase error rates. Results: Comparison subjects, but not schizophrenic patients, showed error-related activity in the anterior cingulate cortex, and this difference in brain activity was significantly different across the two groups. Patients also showed less slowing of reaction time after error commission. Conclusions: Lower error-related activity in the anterior cingulate cortex and less performance adjustment after error commission are consistent with the hypothesis that disturbances in anterior cingulate cortex function are related to a specific alteration in an evaluative component of executive functioning - the internal monitoring of performance.