OBJECTIVE: The presence of a prospective association between cognition and functional outcome in first episode patients with schizophrenia is much debated. METHOD: Associations between Intelligence Quotient (IQ) measures and functional outcome were assessed at the first hospitalization and after 10 years follow-up. RESULTS: Functional outcome was associated with estimated premorbid IQ and IQ at 10-year follow-up, but not with IQ assessed at first hospitalization. CONCLUSION: The presence of a prospective as well as a cross-sectional relationship of the global cognitive measure IQ with 10-year functional outcome could be established. However, assessing associations between cognitive measures assessed at first hospitalization and subsequent functional outcome, can give inconclusive results due to non-uniform intellectual deterioration from premorbid level in the period preceding the first hospitalization.