Few studies have evaluated the longitudinal stability of neuropsychological deficits in schizophrenia. In the present study, 39 inpatients with DSM-III-R schizophrenia were administered a comprehensive battery of neuropsychological tests after achieving sufficient clinical recovery to warrant discharge, and again 1 year after the first assessment during a nonacute period. Significant improvement in neuropsychological functioning from the first to the second assessment was observed on several tasks, including the following: Trails A and B, Digit Symbol, Judgment of Line Orientation, recognition memory on the Rey Auditory Verbal Learning Test, the Wisconsin Card Sort, and Finger Tapping. These improvements were unrelated to treatment history, and were similar in first episode and chronic cases. For many patients, the improvement in functioning brought test performance into line with normative scores from test standardization samples. These results indicate that considerable improvement in neuropsychological functioning can occur in schizophrenic patients over the months following an acute episode of illness, and that recovery of cognitive functioning can occur after substantial clinical recovery from an acute episode of illness has already been achieved.