The hippocampus and prefrontal cortex (PFC) have long been known to play a central role in various behavioral and cognitive functions. More recently, electrophysiological and functional imaging studies have begun to examine how interactions between the two structures contribute to behavior during various tasks. At the same time, it has become clear that hippocampal-prefrontal interactions are disrupted in psychiatric disease and may contribute to their pathophysiology. These impairments have most frequently been observed in schizophrenia, a disease that has long been associated with hippocampal and prefrontal dysfunction. Studies in animal models of the illness have also begun to relate disruptions in hippocampal-prefrontal interactions to the various risk factors and pathophysiological mechanisms of the illness. The goal of this review is to summarize what is known about the role of hippocampal-prefrontal interactions in normal brain function and compare how these interactions are disrupted in schizophrenia patients and animal models of the disease. Outstanding questions for future research on the role of hippocampal-prefrontal interactions in both healthy brain function and disease states are also discussed.