Executive dysfunction is a prominent feature of schizophrenia and may drive core symptoms. Dorsolateral prefrontal cortex (dlPFC) deficits have been linked to schizophrenia executive dysfunction, but mechanistic details critical for treatment development remain unclear. Here, capitalizing on recent animal circuit studies, we develop a task predicted to engage human dlPFC and its interactions with the mediodorsal thalamus (MD). We find that individuals with schizophrenia exhibit selective performance deficits when attention is guided by conflicting cues. Task performance correlates with lateralized MD-dlPFC functional connectivity, identifying a neural readout that predicts susceptibility to conflict during working memory in a larger independent schizophrenia cohort. In healthy subjects performing a probabilistic reversal task, this MD-dlPFC network predicts switching behavior. Overall, our three independent experiments introduce putative biomarkers for executive function in schizophrenia and highlight animal circuit studies as inspiration for the development of clinically relevant readouts.