People with schizophrenia and their high-risk, first-degree relatives report widespread episodic memory impairments that are purportedly due, at least in part, to failures of mnemonic discrimination. Here, we examined the status of mnemonic discrimination in 36 children and adolescents (aged 11–17 years) with and without familial risk for schizophrenia by employing an object-based recognition task called the Mnemonic Similarity Task (MST). The MST assesses the ability to discriminate between studied images and unstudied images that are either perceptually similar to studied images or completely novel. We compared 16 high-risk, unaffected first-degree relatives of people with schizophrenia, bipolar disorder, and/or schizoaffective disorder to 20 low-risk, control participants. High-risk participants showed worse mnemonic discrimination than low-risk participants, with no difference in recognition memory or perceptual discrimination. Our findings demonstrate that mnemonic discrimination deficits previously observed in people with schizophrenia are also present in their young, high-risk, first-degree relatives.