Cognitive deficits are a core feature of schizophrenia, account for much of the impaired functioning associated with the disorder and are not responsive to existing treatments. In this review, we first describe the clinical presentation and natural history of these deficits. We then consider aetiological factors, highlighting how a range of similar genetic and environmental factors are associated with both cognitive function and schizophrenia. We then review the pathophysiological mechanisms thought to underlie cognitive symptoms, including the role of dopamine, cholinergic signalling and the balance between GABAergic interneurons and glutamatergic pyramidal cells. Finally, we review the clinical management of cognitive impairments and candidate novel treatments.