OBJECTIVE: The incidence and outcome of first-episode substance-induced psychotic disorder (SIPD) are unclear. The study aimed to compare the 1-year outcomes of those given a SIPD diagnosis by clinicians compared to other psychosis diagnoses in a first-episode cohort. METHOD: Data were from a large (n = 1027) cohort of first-episode psychosis (FEP) patients admitted to early intervention services in the UK (National EDEN). Diagnosis, including that of SIPD, was made by treating psychiatrists at baseline using ICD10 criteria. Details on symptoms, functioning, quality of life, relapse and recovery were available at baseline and 12 months. RESULTS: There were 67 cases of SIPD (6.5% of the cohort). At baseline, SIPD patients were no different to other psychoses on symptoms, functioning and quality of life. At 12 months, there was no difference in SIPD and other psychoses on functioning, quality of life or relapse and recovery rates. Levels of psychotic and general symptomatology were similar but depressive symptoms were higher in the SIPD group. CONCLUSIONS: First-episode psychosis patients with a diagnosis of SIPD do not appear to have better outcomes than those with other primary psychotic diagnoses. The higher levels of depressive symptoms may be a specific marker in these patients.