The cause of schizophrenia is unknown, but it has a significant genetic component. Pharmacologic studies, studies of gene expression in man, and studies of mouse mutants suggest involvement of glutamate and dopamine neurotransmitter systems. However, so far, strong association has not been found between schizophrenia and variants of the genes encoding components of these systems. Here, we report the results of a genomewide scan of schizophrenia families in Iceland; these results support previous work, done in five populations, showing that schizophrenia maps to chromosome 8p. Extensive fine-mapping of the 8p locus and haplotype-association analysis, supplemented by a transmission/disequilibrium test, identifies neuregulin 1 (NRG1) as a candidate gene for schizophrenia. NRG1 is expressed at central nervous system synapses and has a clear role in the expression and activation of neurotransmitter receptors, including glutamate receptors. Mutant mice heterozygous for either NRG1 or its receptor, ErbB4, show a behavioral phenotype that overlaps with mouse models for schizophrenia. Furthermore, NRG1 hypomorphs have fewer functional NMDA receptors than wild-type mice. We also demonstrate that the behavioral phenotypes of the NRG1 hypomorphs are partially reversible with clozapine, an atypical antipsychotic drug used to treat schizophrenia.