Semantic memory dysfunction in schizophrenia spectrum disorders has been theoretically linked primarily to formal thought disorder (FTD) and, to a lesser extent, hallucinations. Although past studies have demonstrated associations between FTD and semantic memory dysfunction, the potential influence of hallucinations and other symptoms on this association has not previously been evaluated. We investigated the relationship between semantic dysfunction and levels of schizophrenic symptoms in 75 patients with a DSM-IV diagnosis of schizophrenia/schizoaffective disorder. Symptoms were rated on a 0–5 scale using the Scale for Assessment of Positive Symptoms/Scale for Assessment of Negative Symptoms. Semantic dysfunction was quantified through a semantic/phonological fluency difference score. The vocabulary test from the Shipley Institute of Living Scale was included as a measure of pre-morbid IQ. We hypothesized a relationship between FTD and semantic dysfunction, with an alternative hypothesis being that semantic dysfunction would be related to hallucinations. The measure of semantic dysfunction was significantly correlated with level of hallucinations (r =−.35, p =.002), but not level of FTD (r =.05, p =.67). The relationship between hallucinations and semantic dysfunction remained significant after control for age and verbal intellectual ability, and after controlling for the influence of other symptoms. This finding supports theories linking a breakdown in semantic associative networks to the production of hallucinations, and suggests that past associations between formal thought disorder and semantic dysfunction may have been at least partly driven by differential levels of hallucinations between groups.