Schizophrenia is recognized as one of the leading causes of medical disability worldwide, ranked 9th overall by the World Health Organization, and affects more than 2 million Americans per year. There is considerable evidence to suggest that disability status in schizophrenia relates more directly to cognitive Impairment, involving attention, reasoning, and memory, than to characteristic symptoms of psychosis. Accordingly, the evaluation and advancement of interventions designed to restore cognitive function, generally termed cognitive remediation, is of critical importance to our rehabilitation mission. Recent randomized controlled trials of cognitive remediation in schizophrenia have found moderate gains in cognitive function and improved outcomes in important areas of community living. However, despite these encouraging findings, inferences that (1) brain neuroplasticity is intact in schizophrenia, (2) that training effects adaptive change at the neural level, and (3) that change in cognitive test performance occurs through restoration of underlying neural substrates, have yet to be empirically evaluated. This project will begin to address these issues by examining the effects of computer-based cognitive training on event-related potential (ERP) measures of sensory information processing. Two ERP paradigms, mismatch negativity (MMN) and P300 generation, will be administered in auditory and visual modalities. MMN and P300 have been studied extensively in human neuroscience as probes of sensory echoic memory and attention engagement to contextually relevant information. Furthermore, reductions in MMN and P300 generation are reliably observed in schizophrenia, follow the course of a progressive neuropathological process, and correlate with severity of cognitive impairment. The specific aims of this study are to determine: (1) whether training selectively influences bottom-up (MMN) or top-down (P300) information processing, (2) whether training effects are modality specific (auditory vs. visual), (3) whether baseline MMN and P300 predict, or rate-limit, training progress, and (4) whether pre-post change in cognitive test performance is mediated by neural-level change in MMN and P300 generation. Answers to these questions will provide information needed to structure cognitive training for maximum benefit in schizophrenia.