The goal of the present study was to examine the rate of cannabis use among participants in the Cognitive Assessment and Risk Evaluation (CARE) Program, a longitudinal program for individuals who are "at risk" for developing a psychotic disorder. Cannabis abuse was assessed in 48 individuals identified as at risk for psychosis based on subsyndromal psychotic symptoms and/or family history. At 1 year follow-up, 6 of the 48 (12.5%) at risk subjects had made the transition to psychosis. Of the 32 subjects who had no use or minimal cannabis use, one subject (3.1%) converted to psychosis. Of the 16 subjects who met criteria for cannabis abuse/dependence, five (31.3%) converted to psychosis. The results show a significant association between cannabis abuse and conversion to psychosis in this sample. Nicotine use was also found to be significantly associated with later conversion. The significant associations between cannabis and nicotine abuse and conversion to psychosis in individuals at risk for schizophrenia suggest that early identification and intervention programs should screen for and provide education about the deleterious effects of these substances.