There is still no clear consensus as to which of the many functional and structural changes in the brain in schizophrenia are of most importance, although the main focus to date has been on those in the frontal and cingulate cortices. In the present study, we have used a novel holistic approach to identify brain-wide functional connectivity changes in medicated schizophrenia patients, and functional connectivity changes were analyzed using resting-state fMRI data from 69 medicated schizophrenia patients and 62 healthy controls. As far as we are aware, this is the largest population reported in the literature for a resting-state study. Voxel-based morphometry was also used to investigate gray and white matter volume changes. Changes were correlated with illness duration/symptom severity and a support vector machine analysis assessed predictive validity. A network involving the inferior parietal lobule, superior parietal gyrus, precuneus, superior marginal, and angular gyri was by far the most affected (68% predictive validity compared with 82% using all connections) and different components correlated with illness duration and positive and negative symptom severity. Smaller changes occurred in emotional memory and sensory and motor processing networks along with weakened interhemispheric connections. Our findings identify the key functional circuitry altered in schizophrenia involving the default network midline cortical system and the cortical mirror neuron system, both playing important roles in sensory and cognitive processing and particularly self-processing, all of which are affected in this disorder. Interestingly, the functional connectivity changes with the strongest links to schizophrenia involved parietal rather than frontal regions. Hum Brain Mapp 35:123–139, 2014. © 2012 Wiley Periodicals, Inc.