People with schizophrenia often experience a profound lack of motivation for social affiliation-a facet of negative symptoms that detrimentally impairs functioning. However, the mechanisms underlying social affiliative deficits remain poorly understood, particularly under realistic social contexts. Here, we investigated subjective reports and electroencephalography (EEG) functional connectivity in schizophrenia during a live social interaction. Individuals with schizophrenia (n = 16) and healthy controls (n = 29) completed a face-to-face interaction with a confederate while having EEG recorded. Participants were randomly assigned to either a Closeness condition designed to elicit feelings of closeness through self-disclosure or a Small-Talk condition with minimal disclosure. Compared to controls, patients reported lower positive emotional experiences and feelings of closeness across conditions, but they showed comparably greater subjective affiliative responses for the Closeness (vs. Small-Talk) condition. Additionally, patients in the Closeness (vs. Small-Talk) condition displayed a global increase in connectivity in theta and alpha frequency bands that was not observed for controls. Importantly, greater theta and alpha connectivity was associated with greater subjective affiliative responding, greater negative symptoms, and lower disorganized symptoms in patients. Collectively, findings indicate that patients, because of pronounced negative symptoms, utilized a less efficient, top-down mediated strategy to process social affiliation.