IMPORTANCE Preclinical and human data suggest that hippocampal dysfunction plays a critical role in the onset of psychosis. Neural hyperactivity in the hippocampus is thought to drive an increase in subcortical dopamine function through glutamatergic projections to the striatum. OBJECTIVE To examine the association between hippocampal glutamate levels in individuals at clinical high risk for psychosis and their subsequent clinical outcomes. DESIGN, SETTING, AND PARTICIPANTS This cross-sectional study of 86 individuals at clinical high risk for psychosis and 30 healthy control individuals, with a mean follow-up of 18.5 months, was conducted between November 1, 2011, and November 1, 2017, at early detection services in London and Cambridge, United Kingdom. MAIN OUTCOMES AND MEASURES Concentrations of glutamate and other metabolites were measured in the left hippocampus using 3-T proton magnetic resonance spectroscopy at the first clinical presentation. At follow-up, clinical outcomes were assessed in terms of transition or nontransition to psychosis using the Comprehensive Assessment of the At-Risk Mental State criteria and the level of overall functioning using the Global Assessment of Function scale. RESULTS Of 116 total participants, 86 were at clinical high risk for psychosis (50 [58%] male; mean [SD] age, 22.4 [3.5] years) and 30 were healthy controls (14 [47%] male; mean [SD] age, 24.7 [3.8] years). At follow-up, 12 clinical high-risk individuals developed a first episode of psychosis whereas 74 clinical high-risk individuals did not; 19 clinical high-risk individuals showed good overall functioning (Global Assessment of Function Ն65), whereas 38 clinical high-risk individuals had a poor functional outcome (Global Assessment of Function <65). Compared with clinical high-risk individuals who did not become psychotic, clinical high-risk individuals who developed psychosis showed higher hippocampal glutamate levels (mean [SD], 8.33 [1.48] vs 9.16 [1.28] glutamate levels; P = .048). The clinical high-risk individuals who developed psychosis also had higher myo-inositol levels (mean [SD], 7.60 [1.23] vs 6.24 [1.36] myo-inositol levels; P = .002) and higher creatine levels (mean [SD], 8.18 [0.74] vs 7.32 [1.09] creatine levels; P = .01) compared with clinical high-risk individuals who did not become psychotic, and higher myo-inositol levels compared with healthy controls (mean [SD], 7.60 [1.23] vs 6.19 [1.51] myo-inositol levels; P = .005). Higher hippocampal glutamate levels in clinical high-risk individuals were also associated with a poor functional outcome (mean [SD], 8.83 [1.43] vs 7.76 [1.40] glutamate levels; P = .02). In the logistic regression analyses, hippocampal glutamate levels were significantly associated with clinical outcome in terms of transition and nontransition to psychosis (β = 0.48; odds ratio = 1.61; 95% CI, 1.00-2.59; P = .05) and overall functioning (β = 0.53; odds ratio = 1.71; 95% CI, 1.10-2.66; P = .02). CONCLUSIONS AND RELEVANCE The findings indicate that adverse clinical outcomes in i...