The presence of externalizing bias (EB) for negative events together with personalizing bias (PB) (a bias to blame others rather than circumstances) may jointly constitute a vulnerability to develop persecutory delusions (PDs). Whereas EB purportedly serves to defend a vulnerable self-concept by avoiding negative self-attributions and might therefore exacerbate poor insight, PB may reflect cognitive deficits, including theory-of-mind impairment. We investigated these proposals in 34 schizophrenic patients with a history of PDs and 21 healthy controls. Patients with moderate- to severe-PDs and patients without a current PD showed excessive EB which was, surprisingly, absent in patients with mild persecutory delusions (mild-PDs). That EB might wax and wane with fluctuating delusional intensity was interpreted in accord with a new dynamic model of attribution self-representation cycles [Bentall et al., 2000. PDs: A review and theoretical integration. Clinical Psychology Review, 21, 1143-1192]. As predicted, EB exacerbated poor insight. However, counter to predictions, theory-of-mind impairment did not increase PB, which was marked in all participants, whether clinical or non-clinical; instead, theory-of-mind impairment was also correlated with poor insight. Our findings indicate multiple pathways to poor insight, one of which is a theory-of-mind difficulty, impairing the capacity to simulate other perspectives for the purpose of critically evaluating one's own beliefs and circumstances.