Recent heuristic models of schizophrenia propose that abnormalities in the gamma frequency cerebral oscillations may be closely tied to the pathophysiology of the disorder, with hypofunction of N-methyl-d-aspartate receptors (NMDAr) implicated as having a crucial role. Prepulse inhibition (PPI) is a behavioural measure of sensorimotor gating that is disrupted in schizophrenia. We tested the ability for antipsychotic drugs with diverse pharmacological actions to (1) ameliorate NMDAr antagonist-induced disruptions to gamma oscillations and (2) attenuate NMDAr antagonist-induced disruptions to PPI. We hypothesized that antipsychotic-mediated improvement of PPI deficits would be accompanied by a normalization of gamma oscillatory activity. Wistar rats were implanted with extradural electrodes to facilitate recording of electroencephalogram during PPI behavioural testing. In each session, the rats were administered haloperidol (0.25 mg kg(-1)), clozapine (5 mg kg(-1)), olanzapine (5 mg kg(-1)), LY379268 (3 mg kg(-1)), NFPS (sarcosine, 1 mg kg(-1)), d-serine (1800 mg kg(-1)) or vehicle, followed by the NMDAr antagonists MK-801(0.16 mg kg(-1)), ketamine (5 mg kg(-1)) or vehicle. Outcome measures were auditory-evoked, as well as ongoing, gamma oscillations and PPI. Although treatment with all the clinically validated antipsychotic drugs reduced ongoing gamma oscillations, clozapine was the only compound that prevented the sensory-evoked gamma deficit produced by ketamine and MK-801. In addition, clozapine was also the only antipsychotic that attenuated the disruption to PPI produced by the NMDAr antagonists. We conclude that disruptions to evoked, but not ongoing, gamma oscillations caused by NMDAr antagonists are functionally relevant, and suggest that compounds, which restore sensory-evoked gamma oscillations may improve sensory processing in patients with schizophrenia.