It is well known that the P300 amplitude is reduced in schizophrenia patients, which may reflect the pathophysiology and symptom severity of schizophrenia, particularly related to negative symptoms. However, the relationship between the underlying neural generator of the P300 and symptomatic outcomes are not yet fully understood. This study aimed to verify the abnormal P300 of schizophrenia in terms of its source activation to and further examine the relationship between reduced source activation and symptom severity of patients. For this purpose, the P300 was recorded from 34 patients with schizophrenia and matched healthy controls using an auditory oddball paradigm. We found that the P300 amplitude of schizophrenia patients was significantly decreased along the midline electrodes and both bilateral temporal areas compared with healthy controls. In comparing the source activation between the two groups, schizophrenia patients showed decreased source activation predominantly over the left hemisphere, including the cingulate, inferior occipital gyrus, middle occipital gyrus, middle temporal gyrus, posterior cingulate, precuneus, and superior occipital gyrus. Furthermore, we found that the decreased activation of the contrasted areas showed significant negative correlation with PANSS negative symptom scores in the middle temporal gyrus, posterior cingulate, precuneus, and superior occipital gyrus. Our findings suggest that the reduced P300 source activation in schizophrenia might reflect deficits in fronto-temporal-parietal circuit.