Impairment of cortical circuit function is increasingly believed to be central to the pathophysiology of schizophrenia (Sz). Such impairments are suggested to result in abnormal gamma band oscillatory activity observed in Sz patients, and likely underlie the psychosis and cognitive deficits linked to this disease. Development of improved therapeutic strategies to enhance functional outcome of Sz patients is contingent upon a detailed understanding of the mechanisms behind cortical circuit development and maintenance. Convergent evidence from both Sz clinical and preclinical studies suggests impaired activity of a particular subclass of interneuron which expresses the calcium binding protein parvalbumin is central to the cortical circuit impairment observed. Here we review our current understanding of the Sz related cortical circuit dysfunction with a particular focus on the role of fast spiking parvalbumin interneurons in both normal cortical circuit activity and in NMDA receptor hypofunction models of the Sz disease state.