The hippocampal formation (HF) is one of the brain structures most consistently altered in schizophrenia, yet the contribution of HF pathology to severe mental illness is poorly understood. We present evidence that our current ignorance is attributable to the fact that the anterior HF is heavily involved in schizophrenia but has been inadequately examined by schizophrenia investigators. We propose that the anterior HF in humans, and its counterpart in rodents (ventral HF), constrain diverse responses to psychological stimuli and that disruption of this function contributes to schizophrenia. While current data suggest that hallmark symptoms of schizophrenia most likely result from the role of the anterior HF in the integrated neurocircuit that includes the prefrontal cortex, ventral striatum, and ventral tegmental area, better characterized and phylogenetically preserved neurocircuits may be similarly affected by anterior HF pathology and account for associated findings of the disorder. We propose that focusing on the impact of ventral HF pathology on these simpler circuits and functions in rodents may provide insight into the pathophysiology of severe mental illness in humans. We review several associated findings in schizophrenia to assess the likelihood that each could be a product of this putative anterior HF dysfunction and could therefore be productively studied in rodents by probing ventral HF function.