An increasing number of studies implicate the muscarinic cholinergic system in cognitive dysfunction associated with psychosis. This study examined the effect of muscarinic M1 receptor modulation on anterior cingulate cortex (ACC) and striatal choline concentrations and the relation with cognitive performance, as well as functional connectivity of cognitive networks. Thirty medication-free subjects with a psychosis spectrum disorder and 30 gender, age and IQ-matched healthy control subjects underwent 1H-proton magnetic resonance spectroscopy (1H-MRS) twice, once after placebo and once after a single dose of biperiden (M1 receptor antagonist, 4 mg). A subset of 19 psychotic subjects and 28 controls underwent resting-state functional magnetic resonance imaging (rs-fMRI) as well. No significant differences were found in ACC and striatal choline levels, nor in functional connectivity, between the two groups after placebo. Moreover, M1 antagonism did not significantly affect choline levels or functional connectivity. No correlations were found between choline levels and cognition as well as psychotic symptoms. Our findings do not support an association between the cholinergic system and cognition and psychotic symptoms. However, the lack of group differences in choline concentrations and functional connectivity, both after biperiden and placebo, may indicate that there were no severe cholinergic abnormalities present in our sample.