There is increasing evidence that schizophrenics are characterized disturbances in the processing of linguistic context. However, the mechanism responsible for these disturbances remains unidentified. To date, studies have not incorporated methods for contrasting the underlying cognitive processes, such as the spreading activation and strategic-processing mechanisms. This investigation will test the hypothesis that a deficient strategic-processing mechanism produces these contextual processing difficulties through two approaches: (1) by measuring event-related potentials (ERPs) elicited during word recognition in a semantic priming task that assesses both spreading activation and strategic-processing mechanisms; and (2) by evaluating the association between the understanding of larger, more complex units of contextual information (syntactically complex sentences); and the ERP correlates of strategic-processing engaged during word recognition. This investigation will also determine whether these processes are modulated by schizophrenics' medication status. Language processing is highly relevant to the neuropathology of schizophrenia due to its functional association with brain systems implicated in recent neuroanatomical models of the disorder. Thus, elucidation of the mechanism(s) underlying schizophrenics' language disturbances will have significant bearing on our understanding of the neuropathology associated with the disorder. Disordered language is also associated with Schizotypal Personality Disorder (SPD), which is included among the schizophrenia-spectrum disorders. Schizophrenia-spectrum disorders may reflect the genotype for schizophrenia, with diagnosed schizophrenia the product of environmental trauma and neurological sequelae. Thus, a continuum of neurocognitive impairment is presumed to characterize the schizophrenia-spectrum. However, this hypothesized continuum remains largely untested because studies have not compared directly different populations of schizophrenia-spectrum disorders. This investigation will test this hypothesis by comparing the language processing of individuals diagnosed with Schizotypal Personality Disorder who differ on the basis of a family history of schizophrenia (i.e., with and without schizophrenic relatives). Clarification of this issue will have significant etiological implications, as well as contribute to our understanding of the neuropathology associated with the schizophrenia-spectrum disorders.