Patients with major depression, mania, or schizo-affective disorder that had been present without remission for 2 years or more at intake (N = 129) were followed prospectively for 5 years, as were 580 patients who had been ill for shorter periods at intake. Despite very substantial durations of episode, three-quarters of the chronic patients recovered, although recovery occurred much later in the follow-up period than it did among the nonchronic patients. Factors associated with recovery were less severe illness at intake, lack of psychotic features, good friendship patterns in adolescence, and, most important, a relatively high maximum level of functioning in the 5 years preceding intake.