Research has demonstrated widespread negative attitudes held toward people with mental health problems. Our study investigated whether a new prejudice reduction technique, imagined intergroup contact (Crisp & Turner, 2009), could combat stigma against people with mental illness, and the mediating processes through which it may exert this beneficial effect. We found that compared to a control condition, participants who imagined a positive encounter with a schizophrenic person reported weakened stereotypes and formed stronger intentions to engage in future social interactions with schizophrenic people in general. Importantly, these intentions were formed due to reduced feelings of anxiety about future interactions. We discuss the implications of these findings for improving the social inclusion of people with mental health problems.