This study examined the similarities and differences in the communication deficits of 13 schizotypal and 12 schizophrenic children matched by age and IQ. Like schizophrenic children, schizotypal children underutilize some discourse devices necessary for coherent speech and overutilize others. Schizotypal children, however, appear to display a more restricted range of discourse deficits than schizophrenic children. In addition, their discourse deficits do not appear to be associated with clinical measures of loose associations. The clinical implications and the potential use of discourse measures to differentiate schizophrenic and schizotypal children are discussed.