Seeking to unite psychological and biological approaches, this paper links cognitive and cellular hypotheses and data about thought and language abnormalities in schizophrenia. The common thread, it is proposed, is a dysregulated suppression of associations (at the behavioral and functional neural systems level), paralleled by abnormalities of inhibition at the cellular and molecular level, and by an abnormal anatomical substrate (reduced MRI gray matter volume) in areas subserving language.At the level of behavioral experiments and connectionist modeling, data suggest an abnormal semantic network connectivity (strength of associations) in schizophrenia, but not an abnormality of network size (number of associates). This connectivity abnormality is likely to be a preferential processing of the dominant (strongest) association, with the neglect of preceding contextual information.At the level of functional neural systems, the N400 event-related potential amplitude is used to index the extent of "search" for a semantic match to a word. In a short stimulus-onset-asynchrony condition, both schizophrenic and schizotypal personality disorder subjects showed, compared with controls, a reduced N400 amplitude to the target words that were related to cues, e.g. cat-dog, a result compatible with behavioral data. Other N400 data strongly and directly suggest that schizophrenics do not efficiently utilize context. At the level of anatomical system substrates, considerable MRI data indicate abnormalities in the temporal lobe structures that subserve language and verbal associations. Gray matter volume is reduced in the posterior portion of the dominant superior temporal gyrus in both chronic and first episode schizophrenics (but not in manic-depressive psychosis), with the magnitude of reduction correlating with the degree of thought disorder.At the level of in vitro cellular and molecular analysis, NMDA receptors on inhibitory neurons are much more sensitive to blockade than are excitatory projections. A resulting failure of recurrent inhibition may account for the psychotomimetic effects of such NMDA receptor blockers as ketamine and phencyclidine, and may also be present in schizophrenia, where an endogenous NMDA receptor blocker, NAAG, is increased, and where other abnormalities of recurrent inhibition may be present. A biophysical simulation of this circuit abnormality in a model of learned pattern recognition produced, because of the reduction in recurrent inhibition, aberrant spread of excitation, resulting in confusion of normally distinguishable patterns. We suggest the neural circuit failure of inhibition and consequent aberrant spread of activation may be the substrate for an inability to use context, with the behavioral and functional consequences just described. Furthermore, there is the possibility that the unbalanced excitation might lead to progressive, neurodegenerative changes in gray matter, marked by progressive volume reduction.