Neurocognitive dysfunction is a core feature of schizophrenia with particularly prominent deficits in verbal episodic memory. The molecular basis of this memory impairment is poorly understood and its relatedness to normal variation in memory performance is unclear. In this study, we explore, in a sample of cognitively impaired schizophrenia patients, the role of polymorphisms in seven genes recently reported to modulate episodic memory in normal subjects. Three polymorphisms (GRIN2B rs220599, GRM3 rs2189814 and PRKCA rs8074995) were associated with episodic verbal memory in both control and patients with cognitive deficit, but not in cognitively spared patients or the pooled schizophrenia sample. GRM3 and PRKCA acted in opposite directions in patients compared to controls, possibly reflecting an abnormal brain milieu and/or adverse environmental effects in schizophrenia. The encoded proteins balance glutamate signalling vs. excitotoxicity in complex interactions involving the excitatory amino acid transporter 2 (EAAT2), implicated in the dysfunctional glutamatergic signalling in schizophrenia. Double carrier status of the GRM3 and PRKCA minor alleles was associated with lower memory test scores and with increased risk of schizophrenia. Single nucleotide polymorphism (SNP) rs8074995 lies within the PRKCA region spanned by a rare haplotype associated with schizophrenia in a recent UK study and provides further evidence of PRKCA contribution to memory impairment and susceptibility to schizophrenia. Our study supports the utility of parsing the broad phenotype of schizophrenia into component cognitive endophenotypes that reduce heterogeneity and enable the capture of potentially important genetic associations.