Significant differences in the independent processing of trauma-related visual or olfactory cues have been demonstrated in posttraumatic stress disorder (PTSD). Yet, it remains unclear if PTSD-related differences exist in how the olfactory and visual systems interact to process potential threat. The present fMRI study assessed odor-enhanced visual processing (i.e. greater activation in visual areas to combined odor-picture cues compared to picture cues presented alone) in 46 combat veterans (19 with PTSD (CV+PTSD) and 27 healthy controls (HCV)). As expected, general odor-enhanced visual processing was demonstrated in the overall group, and CV+PTSD, compared to HCV, demonstrated significantly more threat odor-enhanced visual cortical activation to neutral images. Unexpectedly, however, CV+PTSD, compared to HCV, demonstrated significantly less threat odor-enhanced visual cortical activation to combat-related images. Functional connectivity findings mirrored those results and indicated a PTSD-related increase in olfactory-visual connectivity with neutral images and decrease with combat-related images. These findings suggest potential sensory processing dysregulation in PTSD that could be based in an olfactory-visual coupling impairment. Findings are also consistent with a PTSD-related focus on potential threat that may override the need to process additional sensory information important for the biological functions that promote survival.