Impaired insight is a hallmark feature of schizophrenia. Structural studies implicate predominantly prefrontal, cingulate, cuneus/precuneus, and inferior temporal brain regions. The cortical midline structures (CMS) are also implicated in functional studies primarily through self-reflective processing tasks. However, few studies have explored the relationship between white matter tracts and insight in schizophrenia, and none in first-episode schizophrenia (FES). Here, we examined for fractional anisotropy (FA) differences in 89 minimally treated FES patients and 98 matched controls, and identified those FA differences associated with impaired clinical insight in patients. We found widespread FA reduction in FES patients compared to controls. Poorer insight in patients was predicted by lower FA values in a number of white matter tracts with a predilection for tracts associated with cortical midline structures (fronto-occipital, cingulate, cingulate hippocampus, uncinate, anterior corona radiata), and more severe depressive symptoms. The association between FA abnormalities and insight was most robust for the awareness of symptoms and illness awareness domains. Our study implicates a network of tracts involved in impaired insight in schizophrenia with a predilection for the CMS. This study is a first step in delineating the white matter tracts involved in insight impairment in schizophrenia prior to chronicity.