Auditory hallucinations (AH), the perception of sounds and voices in the absence of external stimuli, remain a serious problem for a large subgroup of patients with schizophrenia. Functional imaging of brain activity associated with AH is difficult, since the target event is involuntary and its timing cannot be predicted. Prior efforts to image the patterns of cortical activity during AH have yielded conflicting results. In this study, MEG was used to directly image the brain electrophysiological events associated with AH in schizophrenia. We observed an increase in theta rhythm, as sporadic bursts, in the left superior temporal area during the AH states, whereas there was steady theta band activity in the resting state. The present finding suggests strong association of the left superior temporal cortex with the experience of AH in this patient. This is consistent with the hypothesis that AH arises from areas of auditory cortex subserving receptive language processing.