The individualized occupational therapy (IOT) program is a psychosocial program that we developed to facilitate proactive participation in treatment and improve cognitive functioning and other outcomes for inpatients with acute schizophrenia. The program consists of motivational interviewing, self-monitoring, individualized visits, handicraft activities, individualized psychoeducation, and discharge planning. This multicenter, open-labeled, blinded-endpoint, randomized controlled trial evaluated the impact of adding IOT to a group OT (GOT) program as usual for outcomes in recently hospitalized patients with schizophrenia in Japanese psychiatric hospitals setting compared with GOT alone. Patients with schizophrenia were randomly assigned to the GOT+IOT group or the GOT alone group. Among 136 randomized patients, 129 were included in the intent-to-treat population: 66 in the GOT+IOT and 63 in the GOT alone groups. Outcomes were administered at baseline and discharge or 3 months following hospitalization including the Brief Assessment of Cognition in Schizophrenia Japanese version (BACS-J), the Schizophrenia Cognition Rating Scale Japanese version, the Social Functioning Scale Japanese version, the Global Assessment of Functioning scale, the Intrinsic Motivation Inventory Japanese version (IMI-J), the Morisky Medication Adherence Scale-8 (MMAS-8), the Positive and Negative Syndrome Scale (PANSS), and the Japanese version of Client Satisfaction Questionnaire-8 (CSQ-8J). Results of linear mixed effects models indicated that the IOT+GOT showed significant improvements in verbal memory (p <0.01), working memory (p = 0.02), verbal fluency (p < 0.01), attention (p < 0.01), and composite score (p < 0.01) on the BACS-J; interest/enjoyment (p < 0.01), value/usefulness (p < 0.01), perceived choice (p < 0.01), and IMI-J total (p < 0.01) on the IMI-J; MMAS-8 score (p < 0.01) compared with the GOT alone. Patients in the GOT+IOT demonstrated significant improvements on the CSQ-8J compared with the GOT alone (p < 0.01). The present findings provide support for the feasibility in implementing an IOT program and its effectiveness for improving cognitive impairment and other outcomes in patients with schizophrenia.