Schizoaffective patients can have neurocognitive deficits and default mode network dysfunction while being acutely ill. It remains unclear to what extent these abnormalities persist when they go into clinical remission. Memory and executive function were tested in 22 acutely ill schizoaffective patients; they also underwent fMRI scanning during performance of the n-back working memory test. The same measures were obtained after they had been in remission for ≥2 months. Twenty-two matched healthy individuals were also examined. In clinical remission, schizomanic patients showed an improvement of memory but not of executive function, while schizodepressive patients did not change in either domain. All schizoaffective patients in clinical remission showed memory and executive impairment compared to the controls. On fMRI, acutely ill schizomanic patients had reversible frontal hypo-activation when compared to clinical remission, while activation patterns in ill and remitted schizodepressive patients were similar. The whole group of schizoaffective patients in clinical remission showed a failure of de-activation in the medial frontal gyrus compared to the healthy controls. There was evidence for memory improvement and state dependent changes in activation in schizomanic patients across relapse and remission. Medial frontal failure of de-activation in remitted schizoaffective patients, which probably reflects default mode network dysfunction, appears to be a state independent feature of the illness.