Background: Emerging evidence supports the antipsychotic effect of cannabidiol, a non-intoxicating component of cannabis, in people with psychosis. Preclinical findings suggest that this antipsychotic effect may be related to cannabidiol modulating glutamatergic signalling in the brain. Aim: The purpose of this study was to investigate the effects of cannabidiol on the neurochemical mechanisms underlying psychosis. Methods: We investigated the effects of a single oral dose of cannabidiol (600 mg) in patients with psychosis, using a double-blind, randomised, placebo-controlled, repeated-measures, within-subject cross-over design. After drug administration, 13 patients were scanned using proton magnetic resonance spectroscopy to measure left hippocampal glutamate levels. Symptom severity was rated using the Positive and Negative Syndrome Scale 60 min before drug administration (pre-scan), and 270 min after drug administration (post-scan). Effects of cannabidiol on hippocampal glutamate levels, symptom severity, and correlations between hippocampal glutamate and symptoms were investigated. Results: Compared to placebo, there was a significant increase in hippocampal glutamate ( p=0.035), and a significantly greater decrease in symptom severity ( p=0.032) in the psychosis patients under cannabidiol treatment. There was also a significant negative relationship between post-treatment total Positive and Negative Syndrome Scale score and hippocampal glutamate ( p=0.047), when baseline Positive and Negative Syndrome Scale score, treatment (cannabidiol vs placebo), and interaction between treatment and glutamate levels were controlled for. Conclusions: These findings may suggest a link between the increase in glutamate levels and concomitant decrease in symptom severity under cannabidiol treatment observed in psychosis patients. Furthermore, the findings provide novel insight into the potential neurochemical mechanisms underlying the antipsychotic effects of cannabidiol.