There have been recent advances in the ability to identify people at high risk of developing psychosis. This has led to interest in the possibility of preventing the development of psychosis. A randomized controlled trial compared cognitive therapy (CT) over 6 months with monthly monitoring in 58 patients meeting criteria for ultrahigh risk of developing a first episode of psychosis. Participants were followed up over a 3-year period. Logistic regression demonstrated that CT significantly reduced likelihood of being prescribed antipsychotic medication over a 3-year period, but it did not affect transition to psychosis defined using the Positive and Negative Syndrome Scale (PANSS) or probable Diagnostic and Statistical Manual of Mental Disorders, Fourth Edition diagnosis. However, exploratory analyses revealed that CT significantly reduced the likelihood of making progression to psychosis as defined on the PANSS over 3 years after controlling for baseline cognitive factors. Follow-up rate at 3 years was 47%. There appear to be enduring benefits of CT over the long term, suggesting that it is an efficacious intervention for people at high risk of developing psychosis. © The Author 2006. Published by Oxford University Press on behalf of the Maryland Psychiatric Research Center. All rights reserved.