Diffusion tensor imaging (DTI) studies show widespread white matter abnormalities in schizophrenia, but it is difficult to directly relate these parameters to biological processes. Neurite orientation dispersion and density imaging (NODDI) is geared toward biophysical characterization of white matter microstructure, but only few studies have leveraged this technique to study white matter alterations. We recruited 42 schizophrenia patients (30 antipsychotic-naïve and 12 currently untreated) and 42 matched controls in this prospective study. We assessed the orientation dispersion index (ODI) and extracellular free water (FW) using single-shell DTI data before and after a 6-week trial of risperidone. Longitudinal data were available for 27 patients. Voxelwise analyses showed significantly increased ODI in the posterior limb of the internal capsule in unmedicated patients (242 voxels; x = −24; y = 6; z = 6; p < 0.01; α < 0.04), but no alterations in FW. Whole brain measures did not reveal alterations in ODI but a 6.3% trend-level increase in FW in unmedicated SZ (t = −1.873; p = 0.07). Baseline ODI was negatively correlated with subsequent response to antipsychotic treatment (r = −0.38; p = 0.049). Here, we demonstrated altered fiber complexity in medication-naïve and unmedicated patients with a schizophrenia spectrum illness. Lesser whole brain fiber uniformity was predictive of poor response to treatment, suggesting this measure may be a clinically relevant biomarker. Interestingly, we found no significant changes in NODDI indices after short-term treatment with risperidone. Our data show that biophysical diffusion models have promise for the in vivo evaluation of brain microstructure in this devastating neuropsychiatric syndrome.