We evaluated psychiatric symptoms and neurocognitive functioning among 25 institutionalized and 25 outpatient DSM-IV-diagnosed schizophrenia patients, as well as 25 middle-aged and elderly normal comparison subjects. All subjects were assessed with the Positive and Negative Syndrome Scale, Hamilton Rating Scale for Depression, modified Simpson-Angus Extrapyramidal Symptom Scale, the Abnormal Involuntary Movement Scale, and the Mattis Dementia Rating Scale (DRS). The two patient groups had similar levels of depressive symptoms, but the institutionalized patients had more severe positive and negative symptoms and were on higher doses of neuroleptic medication. The institutionalized patients had significantly more cognitive impairment on the DRS than outpatients and normal comparison subjects, particularly on the subscales of initiation/perseveration, conceptualization, and memory. Results are discussed in terms of the possible neuropathology associated with cognitive impairment in chronic schizophrenia.