The impact of alcoholism (ALC) or alcohol dependence on the neural mechanisms underlying cognitive and affective empathy (i.e. the different routes to understanding other people's minds) in schizophrenic patients and non-schizophrenic subjects is still poorly understood. We therefore aimed at determining the extent to which the ability to infer other people's mental states and underlying neural mechanisms were affected by ALC. We examined 48 men, who suffered either from ALC, schizophrenia, both disorders or none of these disorders, using functional magnetic resonance imaging while performing on a mind reading task that involves both cognitive and affective aspects of empathy. Using voxel-based morphometry, we additionally examined whether between-group differences in functional activity were associated with deficits in brain structural integrity. During mental state attribution, all clinical groups as compared with healthy controls exhibited poor performance as well as reduced right-hemispheric insular function with the highest error rate and insular dysfunction seen in the schizophrenic patients without ALC. Accordingly, both behavioral performance and insular functioning revealed schizophrenia × ALC interaction effects. In addition, schizophrenic patients relative to non-schizophrenic subjects (regardless of ALC) exhibited deficits in structural integrity and task-related recruitment of the left ventrolateral prefrontal cortex (vlPFC). Our data suggest that ALC-related impairment in the ability to infer other people's mental states is limited to insular dysfunction and thus deficits in affective empathy. By contrast, mentalizing in schizophrenia (regardless of ALC) may be associated with insular dysfunction as well as a combination of structural and functional deficits in the left vlPFC.