Cognitive dysfunction is increasingly being recognized as a major contributor to the adaptive impairment seen in most patients with schizophrenia. Reported here is a prospective longitudinal evaluation of the relationship between cognitive and adaptive functioning in elderly patients with schizophrenia. It was hypothesized that baseline cognitive and negative, but not positive symptoms, would be predictive of cross-sectional impairment and longitudinal outcome. Subjects were 168 elderly patients with schizophrenia, free of major neurological disorders, who were residents of a long-term psychiatric facility. Subjects were assessed at baseline and again an average of 15months later. The PANSS was used to assess the severity of symptoms of schizophrenia. Cognitive symptoms were assessed using the components of the CERAD cognitive battery. Social and adaptive functioning was assessed using the SAFE scale. Spearman correlations were determined among clinical variables, and the rank ordering of prediction of SAFE scale scores at follow-up was determined using a stepwise regression procedure. At follow-up, adaptive life skills correlated with cognitive performance and negative symptoms (Spearman rho values 0. 41-0.57, all p values <0.0001), but not positive symptoms (r=0.09, n. s.). Among cognitive tasks, verbal learning and memory were most highly correlated with adaptive skills at follow-up. These results confirm and extend previous studies that indicate that cognitive impairments are predictive, both cross-sectionally and longitudinally, of adaptive life skills in persons with schizophrenia. Negative symptoms, but not positive symptoms, were correlated with impaired adaptive skills. Taken together, these results underscore the need to develop more effective treatments for cognitive and negative symptoms in schizophrenia.