Transcranial magnetic stimulation (TMS) and repetitive TMS (rTMS) have been used increasingly over the past few years to study both the pathophysiology of schizophrenia as well as the utility of focal neuromodulation as a novel treatment for schizophrenia. rTMS treatment studies to date have explored its effect on both positive and negative symptoms by targeting cortical regions thought to underlie these symptom clusters. Studies on auditory hallucinations have been largely positive, while efficacy for negative symptoms is equivocal. A better understanding of the functional abnormalities that accompany symptoms may facilitate the development of rTMS as a treatment modality. Furthermore, schizophrenia patients appear to have abnormal cortical inhibition, consistent with GABA and dopamine abnormalities in schizophrenia. The effect of TMS on GABA and dopamine neurotransmission has not been clearly delineated. Given the variability in cortical response to rTMS in schizophrenia, methods to optimize dosage are essential. Consideration of these factors among others may broaden the scope of utility of TMS for schizophrenia as well as enhance its efficacy.