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Family history of disease can provide valuable information in case-control association studies, but it is currently unclear how to best combine case-control status and family history of disease. We developed an association method based on posterior mean genetic liabilities under a liability threshold model, conditional on case-control status and family history (LT-FH). Analyzing 12 diseases from the UK Biobank (average N = 350,000) we compared LT-FH to genome-wide association without using family history (GWAS) and a previous proxy-based method incorporating family history (GWAX). LT-FH was 63% (standard error (s.e.) 6%) more powerful than GWAS and 36% (s.e. 4%) more powerful than the trait-specific maximum of GWAS and GWAX, based on the number of independent genome-wide-significant loci across all diseases (for example, 690 loci for LT-FH versus 423 for GWAS); relative improvements were similar when applying BOLT-LMM to GWAS, GWAX and LT-FH phenotypes. Thus, LT-FH greatly increases association power when family history of disease is available.