Patients with schizophrenia suffer from cognitive deficits which are important predictors of functional outcome. Alterations such as reduced muscarinic and nicotinic receptors in the central cholinergic system in patients with schizophrenia may contribute to these cognitive impairments. Because such deficits do not respond to neuroleptic treatment, different approaches have been developed regarding pharmacological treatments that enhance central cholinergic transmission, e.g. with acetylcholinesterase inhibitors. In this review the pathophysiology of cognitive impairment in schizophrenia, results of studies using acetylcholinesterase inhibitors (donepezil, rivastigmine, physostigmine, and galantamine), and future research strategies are presented. Till now randomized, placebo-controlled studies exist only for donepezil and rivastigmine, and none could replicate the positive results of previous trials with open designs. More trials with higher numbers of patients are needed, particularly for substances with more complex mechanisms of action (e.g. galantamine).