Abstract Background This study focuses on people with complex and severe mental health problems who require inpatient rehabilitation. The majority have a diagnosis of schizophrenia whose recovery has been delayed due to non-response to first-line treatments, cognitive impairment, negative symptoms and co-existing problems such as substance misuse. These problems contribute to major impairments in social and everyday functioning necessitating lengthy admissions and high support needs on discharge to the community. Engagement in structured activities reduces negative symptoms of psychosis and may lead to improvement in function, but no trials have been conducted to test the efficacy of interventions that aim to achieve this. Methods/design This study aims to investigate the clinical and cost-effectiveness of a staff training intervention to increase service users’ engagement in activities. This is a single-blind, two-arm cluster randomised controlled trial involving 40 inpatient mental health rehabilitation units across England. Units are randomised on an equal basis to receive either standard care or a “hands-on”, manualised staff training programme comprising three distinct phases (predisposing, enabling and reinforcing) delivered by a small team of psychiatrists, occupational therapists, service users and activity workers. The primary outcome is service user engagement in activities 12 months after randomisation, assessed using a standardised measure. Secondary outcomes include social functioning and costs and cost-effectiveness of care. Discussion The study will provide much needed evidence for a practical staff training intervention that has potential to improve service user functioning, reducing the need for hospital treatment and supporting successful community discharge. The trial is registered with Current Controlled Trials (Ref ISRCTN25898179).