Background: This study aims to compare severity criteria defined by the Remission in Schizophrenia Working Group (RSWGcr) with other criteria in relation to functional and neurocognitive outcome. Methods: 112 chronic psychotic outpatients were examined. Symptomatic remission according to RSWGcr was compared with the outcome achieved using criteria based on PANSS Positive and Negative Scales (PANSS-PNScr) and the entire PANSS (PANNS-TScr). Results: Remission rates were 50%, 35% and 23% respectively at RSWGcr, PANSS-PNScr and PANNS-TScr; functional remission rates were 32%, 42% and 54%. Sensitivity, specificity, predictive value and ROC analysis demonstrated the superiority of PANSS-PNScr in identifying patients with higher functional and cognitive outcomes. Regression analysis showed a significant predictive effect of PANSS-TScr on functioning. General linear model analyses demonstrated significantly higher mean scores at PSP and BACS for patients remitted according to PANSS-TScr. Conclusion: The use of more restrictive severity criteria of remission seems to be associated with improved identification of truly remitted patients.