Theory of mind (ToM) impairments are well documented in schizophrenia, although it remains unclear whether these deficits exist among individuals with schizotypy. The current study sought to shed light on mixed findings in schizotypy by differentiating between various aspects of ToM, (cognitive/affective ToM and overmentalization/undermentalization). A three-group design (positive schizotypy, negative affect, and healthy control) was used to assess ToM performance on the Movie for Assessment of Social Cognition. Results indicated that the positive schizotypy group made greater intent overmentalization errors than both control groups. The schizotypy and negative affect groups made greater emotion overmentalization errors relative to healthy controls. In addition, the authors explored the relationship between ToM, schizotypal traits, and psychosocial functioning. Results demonstrated a significant positive relationship between cognitive-perceptual schizotypal traits and intent overmentalization as well as a significant positive relationship between interpersonal traits and emotion overmentalization. Finally, intent and emotion overmentalization were both related to poorer psychosocial functioning.