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Button felt he lost a chance to qualify higher when he was called in for a weight verification.
"My first run wasn't quick enough because we had quite low grip," he said. "The circuit was improving massively all the time and we thought we could get a second chance to do a run but then I got called on the weightbridge."
Red Bull's David Coulthard, Britain's other hope, didn't make it to the final section which determines pole position. He was just 11th after the second section.
Jarno Trulli of Toyota had a short session. His engine blew up in smoke and fire after just one lap and he will start from the back of the grid on Sunday with a new engine.
Schumacher had the fastest time in the last qualification for a race at the Monaco Grand Prix two weeks ago. However he had to start from the back of the pack after stewards ruled he intentionally stopped his car on the track during qualifying and hindered several drivers behind him, including Alonso.
The German was demoted and Alonso moved up to pole position, winning for the first time at Monaco. Schumacher was fifth, but set the fastest lap late in the race.
Schumacher trails Alonso in the season standings. After four victories and three seconds, Alonso has 64 points. Schumacher has 43 with two victories and two seconds.
Schumacher has won the British GP three times for Ferrari and the Italian team added another victory with Rubens Barrichello in 2002, meaning the red cars have finished first here four times since 1998.
That equals McLaren's feat of four wins here in the past seven years _ David Coulthard in 1999 and 2000, Mika Hakkinen in 2001 and Juan-Pablo Montoya last year.