Previous studies have observed reduced suppression of the default mode network (DMN) during cognitive tasks in schizophrenia, suggesting inefficient DMN suppression is critical for the cognitive deficits of schizophrenia. Cognitive function in schizophrenia patients, however, varies from relatively intact to severely impaired. This study, which compared the DMN suppression patterns between first-episode schizophrenia patients with (SZ-Imp) and without (SZ-Pre) impaired cognitive function, may provide further insight into the role of DMN dysfunction in cognitive deficits of schizophrenia. Independent component analysis (ICA) was applied to resting-state fMRI data to identify the DMN in each subject, and then general linear modeling based on the task-fMRI data was used to examine the different DMN activation patterns between groups. We observed that the SZ-Imp group, but not the SZ-Pre group, showed reduced suppression in the medial prefrontal cortex and posterior cingulated cortex when compared to the healthy controls (HC) group. Moreover, less DMN suppression was associated with poorer task performance in both HC and patient groups. Our findings provide the first direct evidence that disrupted DMN activity only exists in schizophrenia patients with impaired cognitive function, supporting the specific neuro-pathological role of inefficient DMN suppression in cognitive deficits of first-episode schizophrenia.