Schizophrenia is a psychiatric disorder characterized by social dysfunction. People with schizophrenia misinterpret social information and it is suggested that this difficulty may result from visual processing deficits. As faces are one of the most important sources of social information it is hypothesized that people suffering from the disorder have impairments in the visual face processing system. It is unclear which mechanism of the face processing system is impaired but two types of deficits are most often proposed: a deficit in face perception in general (i.e., processing of facial features as such) and a deficit in facial emotion processing (i.e., recognition of emotional facial expressions). Due to the contradictory evidence from behavioural, electrophysiological as well as neuroimaging studies offering support for the involvement of one or the other deficit in schizophrenia it is early to make any conclusive statements as to the nature and level of impairment. Further studies are needed for a better understanding of the key mechanism and abnormalities underlying social dysfunction in schizophrenia.