The rs1344706, an intronic SNP within the zinc-finger protein 804A gene (ZNF804A), was identified as one of the most compelling risk SNPs for schizophrenia (SZ) and bipolar disorder (BD). It is however not clear by which molecular mechanisms ZNF804A increases disease risk. We evaluated the role of ZNF804A in SZ and BD by genotyping the originally associated rs1344706 SNP and an exonic SNP (rs12476147) located in exon four of ZNF804A in a sample of 422 SZ, 382 BD, and 507 controls from the isolated population of the Costa Rica Central Valley. We also investigated the rs1344706 SNP for allelic specific expression (ASE) imbalance in the dorsolateral prefrontal cortex (DLPFC) of 46 heterozygous postmortem brains.While no significant association between rs1344706 and SZ or BD was observed in the Costa Rica sample, we observed an increased risk of SZ for the minor allele (A) of the exonic rs12476147 SNP (p. = 0.026). Our ASE assay detected a significant over-expression of the rs12476147 A allele in DLPFC of rs1344706 heterozygous subjects. Interestingly, cDNA allele ratios were significantly different according to the intronic rs1344706 genotypes (p-value. = 0.03), with the rs1344706 A allele associated with increased ZNF804A rs12476147 A allele expression (average 1.06, p-value. = 0.02, for heterozygous subjects vs. genomic DNA).In conclusion, we have demonstrated a significant association of rs12476147 with SZ, and using a powerful within-subject design, an allelic expression imbalance of ZNF804A exonic SNP rs12476147 in the DLPFC. Although this data does not preclude the possibility of other functional variants in ZNF804A, it provides evidence that the rs1344706 SZ risk allele is the cis-regulatory variant directly responsible for this allelic expression imbalance in adult cortex. © 2013 Elsevier B.V.