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The purpose of this experiment was to replicate and extend to a memory task Bentall and Slade's (1985) finding that hallucinations in schizophrenic patients were linked to a liberal decision bias. A word recognition task was administered to 40 schizophrenic patients and 40 normal controls that yielded two indices of performance: an index of discrimination accuracy (Pr) and one of decision bias (Br). Patients obtained a lower Pr than controls, whereas Br was similar in both groups. In patients, Br was selectively correlated with positive symptomatology: the more the positive symptoms, the more liberal the bias. In particular, there was a specific correlation between decision bias and hallucinations. Conversely, Pr was inversely correlated with severity of depression, but not with either positive or negative symptoms. Thus, positive symptomatology may be linked more to difficulties in distinguishing between representations of internal versus external events than to deficits in encoding external events.