Abuse of alcohol and drugs is an important and clinically challenging aspect of first-episode psychosis. Only a few studies have been carried out on large-sized and reliably characterized samples. These are reviewed, and the results are compared with a sample of 300 first-episode psychosis patients recruited for the TIPS (Early Treatment and Identification of Psychosis) study from Norway and Denmark. Prevalence rates from the literature vary from 6% to 44% for drugs and 3% to 35% for alcohol. In our sample, 23% abused drugs and 15% abused alcohol during the last 6 months. When compared to non-abusers, the drug-abusing group is characterized by the following: male gender, younger age, better premorbid social, poor premorbid academic functioning, and more contact with friends in the last year before onset. Alcohol abusers were the oldest group and they had the least contact with friends. A group of patients abusing both drugs and alcohol had poor premorbid academic functioning from early childhood. Overall, drug and alcohol abuse are highly prevalent in contemporary first-episode psychosis samples. In our study, substance abuse comorbidity did not generate differences on diagnosis, duration of untreated psychosis, psychiatric symptoms, or global functioning at onset/baseline. The premorbid profiles of the substance abusers were clearly different from the non-abusers. Drug abusers, in particular, were more socially active both premorbidly and during the year preceding the start of treatment.