Abstract Background Exposure to combat can have a significant impact across a wide array of domains, and may manifest as post-traumatic stress disorder (PTSD), a debilitating mental illness that is associated with neural and affective sequelae. This study tested the hypothesis that combat-exposed individuals with and without PTSD, relative to healthy control subjects with no history of PTSD or combat exposure, would show amygdala hyperactivity during performance of a well-validated face processing task. We further hypothesized that differences in the prefrontal cortex would best differentiate the combat-exposed groups with and without PTSD. Methods Twelve men with PTSD related to combat in Operations Enduring Freedom and/or Iraqi Freedom, 12 male combat-exposed control patients with a history of Operations Enduring Freedom and/or Iraqi Freedom combat exposure but no history of PTSD, and 12 healthy control male patients with no history of combat exposure or PTSD completed a face-matching task during functional magnetic resonance imaging. Results The PTSD group showed greater amygdala activation to fearful versus happy faces than both the combat-exposed control and healthy control groups. Both the PTSD and the combat-exposed control groups showed greater amygdala activation to all faces versus shapes relative to the healthy control group. However, the combat-exposed control group relative to the PTSD group showed greater prefrontal/parietal connectivity with the amygdala, while the PTSD group showed greater connectivity with the subgenual cingulate. The strength of connectivity in the PTSD group was inversely related to avoidance scores. Conclusions These observations are consistent with the hypothesis that PTSD is associated with a deficiency in top-down modulation of amygdala activation by the prefrontal cortex and shows specific sensitivity to fearful faces.