BackgroundLittle is known about the relationship between poverty and outcomes of severe mental illness (SMI) during a period of sustained rapid socioeconomic development. This study explored the relationship between poverty and outcomes of people with SMI in a 21-year longitudinal study in a rural area of China. MethodsEpidemiological surveys of mental disorders were conducted in May, 1994, and October, 2015, in the same six townships (total population 170 174 in 2015) in Xinjin County, Chengdu, China. Psychoses Screening Schedule together with key informant method for household survey and general psychiatric interview were administered to identify people with SMI (including schizophrenia, bipolar disorders, and major depressive disorder) according to International Classification of Mental and Behavioural Disorders-10 criteria. FindingsWe identified 711 people with SMI aged 15 years and older in 1994 and 1042 in 2015. The annual net income per person in people with SMI was significantly lower in 1994 (1110·0 RMB) and 2015 (8420·1 RMB) (p<0·0001) than in the population of Xinjin (1330·0 RMB and 16856·0 RMB, respectively). The rate of having poor family economic status (<mean level) in people with SMI was significantly higher in 2015 (65·2%) than in 1994 (48·2%, p<0·0001). Poor family economic status was significantly associated with being male and unmarried, a lower number of family members, and lower rates of partial and full remission of SMI in 1994 and 2015 (p<0·05). Poor family economic status was also significantly associated with lower education level, lower rate of having a family caregiver, higher total score on the Positive and Negative Syndrome Scale, lower total score of Global Assessment of Functioning, and lower rates of medication in 2015 (p<0·05). InterpretationRelative poverty has become more severe in people with SMI during the period of rapid socioeconomic development from 1994 to 2015 in China, and it is associated with poor outcomes of SMI. Prevention of the cycle of poverty and mental illness should be vital for Healthy China 2030. Targeted poverty alleviation programmes and community-based mental health care should be crucial for enhancing economic status and improving outcomes of people with SMI. FundingThe survey in 1994 was supported in part by China Medical Board of New York (92-557, principal investigator: MZX). The survey in 2015 was supported in part by Seed Funding Programme for Basic Research (Hong Kong University, 2014–2016, principal investigator: MSR), Seed Funding Programme for Applied Research (HKU, 2014–2016, principal investigator: MSR), Strategic Research Theme: Contemporary China Seed Funding (HKU, 2014–2016, principal investigator: MSR), Small Project Funding (HKU, 2014-2016, principal investigator: CLWC), and Mental Health Research in Chengdu, China (Department Matching Fund, 2015–2017, principal investigator: MSR).