The rs1076560 polymorphism of DRD2 (encoding dopamine receptor D2) is associated with alternative splicing and cognitive functioning; however, a mechanistic relationship to schizophrenia has not been shown. Here, we demonstrate that rs1076560(T) imparts a small but reliable risk for schizophrenia in a sample of 616 affected families and five independent replication samples totaling 4017 affected and 4704 unaffected individuals (odds ratio=1.1; P=0.004). rs1076560(T) was associated with impaired verbal fluency and comprehension in schizophrenia but improved performance among healthy comparison subjects. rs1076560(T) also associated with lower D2 short isoform expression in postmortem brain. rs1076560(T) disrupted a binding site for the splicing factor ZRANB2, diminished binding affinity between DRD2 pre-mRNA and ZRANB2 and abolished the ability of ZRANB2 to modulate short:long isoform-expression ratios of DRD2 minigenes in cell culture. Collectively, this work implicates rs1076560(T) as one possible risk factor for schizophrenia in the Han Chinese population, and suggests molecular mechanisms by which it may exert such influence.