A convergence of preclinical pharmacology, and human autopsy and genetic data support the existence of reduced expression and function of the alpha7 nicotinic receptor in patients with schizophrenia. The alpha7 nicotinic receptor is a member of a family of ligand-gated ion channels. The alpha7 nicotinic receptor may play an essential role in auditory sensory gating and voluntary smooth pursuit eye movements, two psychophysiological functions that are abnormal in patients with schizophrenia and closely related unaffected biological relatives. Diminished expression or function of the alpha7 nicotinic receptor in schizophrenia has stimulated consideration of selective full or partial alpha7 nicotinic receptor agonists as possible therapeutic interventions for this disorder. Further, the availability of positive allosteric modulators of nicotinic receptors that can improve the efficiency of transduction of the acetylcholine signal and prevent the rapid desensitization of the receptor should encourage these novel treatment approaches (e.g., galantamine).