Neural underpinnings of verbal memory encoding and recognition impairments in individuals with clinically stable mood or schizophrenia spectrum disorders

• We investigated a new naturalistic verbal episodic memory fMRI task. • Patients recalled fewer words and had lower recognition accuracy than controls. • The task activated the expected memory-related networks similarly across groups. • Patients showed hyperactivity in visual processing areas not associated with recall. : Verbal memory impairment is prevalent in mood and schizophrenia spectrum disorders and contributes to poor functional outcomes. The neural correlates of these memory difficulties remain unclear due to a scarcity of neuroimaging studies assessing verbal memory and low ecological validity of current paradigms. The aim of this study was to examine neurocircuitry abnormalities in mood and schizophrenia spectrum disorders using a new verbal memory task simulating everyday grocery shopping. : Fifty-seven cognitively impaired individuals with clinically stable mood or schizophrenia spectrum disorders and 52 matched healthy controls were included. We compared task-related activation between patients and controls and the associations between encoding- and recognition-related activity with memory recall and recognition performance. : Patients recalled fewer words and had a lower recognition accuracy than controls ( ps ≤.01). Both encoding and recognition elicited activation in regions typically associated with episodic memory. Patients showed encoding-related hyperactivation in a large cluster within the supracalcarine part of the occipital cortex ( p <.001), although this did not correlate with recall performance. Recall performance correlated with encoding-related activation in frontal and occipital areas across all participants, but there was no group difference in neural response in these clusters. The recognition task yielded no group differences in neural activation. : While the paradigm elicited robust activation of expected memory-relevant networks, it was not sensitive to capture patients’ memory impairments at the neural level. Our findings suggest that patients successfully engage memory-relevant networks during encoding, with their difficulties possibly emerging during later free recall stages not captured by the paradigm.