Schizophrenia and autism both feature significant impairments in social cognition and social functioning, but the specificity and mechanisms of these deficits remain unknown. Recent research suggests that social cognitive deficits in both disorders may arise from dysfunctions in the neural systems that underlie social cognition. We explored the neural activation of discrete brain regions implicated in social cognitive and face processing in schizophrenia subgroups and autism spectrum disorders during complex social judgments of faces. Twelve individuals with autism spectrum disorders (ASD), 12 paranoid individuals with schizophrenia (P-SCZ), 12 non-paranoid individuals with schizophrenia (NP-SCZ), and 12 non-clinical healthy controls participated in this cross sectional study. Neural activation, as indexed by blood oxygenation level dependent (BOLD) contrast, was measured in a priori regions of interest while individuals rated faces for trustworthiness. All groups showed significant activation of a social cognitive network including the amygdala, fusiform face area (FFA), superior temporal sulcus (STS), and ventrolateral prefrontal cortex (VLPFC) while completing a task of complex social cognition (i.e. trustworthiness judgments). ASD and P-SCZ individuals showed significantly reduced neural activation in the right amygdala, FFA, and left VLPFC as compared to controls and in the left VLPFC as compared to NP-SCZ individuals during this task. These findings lend support to models hypothesizing well-defined neural substrates of social cognition and suggest a specific neural mechanism that may underlie social cognitive impairments in both autism and paranoid schizophrenia.