Schizophrenia is a severe mental disorder and a leading cause of global disability. Increasing evidence ties impairments in both auditory and visual perceptual processing to impaired functional outcomes. In the auditory system, deficits are observed in the ability to process changes in tonality, leading to deficits in the detection of nonverbal aspects of auditory communication, including emotion and sarcasm. In the auditory sytem, these deficits are indexed by impaired generation of mismatch negativity (MMN), which has become a widely utilized index of auditory perceptual dysfunction. In the visual system, deficits are especially observed in functions related to the magnocellular visual pathway, which projects preferentially to the dorsal visual stream. Dorsal stream dysfunction, in turn, contributes to impairments in processes such as fragmented object recognition, face emotion recognition, and social cognition. Indices of visual perceptual dysfunction include visual P1 responses to magnocellular-biased stimuli, as well as fMRI activation levels within the dorsal and ventral streams. Perceptual level deficits are tied most directly to impaired function of N-methyl-D-aspartate glutamate receptors (NMDAR) and thus may serve both as pathophysiologically based nosological biomarkers and as targets for neuromodulatory and pharmacological treatment development.