BACKGROUND: Alpha EEG guided Transcranial Magnetic Stimulation (αTMS) of the dorsolateral prefrontal cortex (DLPFC) has shown promising efficacy for treating the negative symptoms of schizophrenia. OBJECTIVE/ HYPOTHESIS: The purpose of the current investigation was to test (1) the therapeutic effect in other domains of symptoms of schizophrenia and (2) the specificity of stimulus location. The hypothesis to be tested was that global alpha EEG normalization after αTMS would help improve the clinical symptoms of schizophrenia, regardless of the site of stimulation. METHOD: Seventy-eight patients with schizophrenia were enrolled in a randomized, double-blind, sham-controlled study with four study groups: frontal αTMS, parietal αTMS, frontal sham, and parietal sham. Patients received daily treatment for 10 days and clinical evaluations at day 5 and 10. The stimulus rate and intensity were determined by individual's characteristic alpha frequency and motor threshold (80%). RESULTS: Positive and general psychotic symptoms improved significantly after αTMS (P < 0.02). Frontal and parietal αTMS had similar effects (P = 0.48). (3) αTMS with concomitant typical neuroleptics treatment had greater efficacy than atypical neuroleptics (P < 0.04). Degree of EEG normalization as measured by increase in Q factor was highly associated with the improvement in all three domains of symptoms of schizophrenia (P < 0.04). CONCLUSIONS: Alpha EEG normalization after treatment with αTMS may directly subserve the processes underlying clinical improvements in schizophrenia. Nonetheless, given the confound of possible unblinding of participants because of an inactive sham control, the current results should be considered preliminary until replicated further.