Although psychosis is common in bipolar disorder, few studies have examined the prognostic significance of psychotic features. In addition, some studies suggest that the presence of mood-incongruent psychosis, in particular, is associated with poorer outcome compared with mood-congruent psychosis. We assesses the phenomenology and prevalence of mood-congruent and mood-incongruent psychotic symptoms in 352 patients with bipolar I disorder participating in the Stanley Foundation Bipolar Treatment Network. We compared the demographic and clinical features, and measures of psychosocial and vocational functioning in patients with and without a history of psychosis. The phenomenology of psychosis in this cohort of patients with bipolar disorder was similar to that reported in earlier studies and supported the lack of diagnostic specificity of any one type of psychotic symptom. There were no significant differences between patients with and without a history of psychosis on any demographic, psychosocial, vocational, or course of illness variables. Only family history of bipolar disorder was significantly more common in patients with nonpsychotic bipolar disorder compared to patients with a history of psychosis. Among bipolar patients with a history of psychosis, only the proportion of women and lifetime prevalence rates of anxiety disorders occurred significantly more in patients with mood-incongruent delusions. In this large cohort of outpatients with bipolar I disorder, neither a history of psychosis nor of mood-incongruent psychosis had prognostic significance at entry into the Network. The lack of observable prognostic impact may have been, in part, due to the relatively high morbidity and poor functional outcome of a substantial portion of the total cohort.