AimIndividuals at clinical high risk (CHR) for psychosis often experience poor social functioning and impaired facial emotion recognition (FER); however, the impact of frequently comorbid symptoms upon these processes is underexplored. In particular, social anxiety is characteristic of this population and also related to poor social functioning and FER biases, such as misinterpreting neutral faces as negative or threatening; however, little is known about how social anxiety relates to these processes in CHR individuals. The present study examined the overlap of social anxiety, social functioning, and FER accuracy and bias.MethodParticipants (CHR N = 62, healthy controls N = 52) completed the self‐report Social Interaction Anxiety Scale (SIAS), Penn Emotion Recognition‐40 (ER‐40) behavioural task, and interviewer‐rated Global Functioning Scale‐Social (GFS‐S). The ER‐40 was used to assess both FER accuracy (e.g., overall number of correct responses) and bias (e.g., mislabelling neutral faces as angry).ResultsConsistent with previous research, relative to controls, CHR participants had more social anxiety (d = −1.07), poorer social functioning (d = −1.62), and performed more poorly on the FER task (e.g., d = −.37). Within CHR participants, social anxiety was related to an anger detection bias (r = .28), above and beyond positive symptom severity, which in turn was related to FER accuracy (r = .26) and social functioning (r = −.28).ConclusionThese findings suggest that ongoing work examining social processes within CHR individuals needs to account for social anxiety and that social anxiety may be a useful preventive intervention target.