Background: Psychosis, encompassing conditions such as schizophrenia and bipolar affective disorder with psychotic features, presents a perplexing landscape where language dysfunction emerges as a notable hallmark. Compared to classical psychotic symptoms (such as delusions and hallucinations), language disorganization can be directly observed, and it is not dependent upon subjective reports of abnormal experiences on part of the patient. Consequently, it has been regarded by researchers as a more objective and informative clinical marker of brain dysfunction in psychosis. There is a dearth of Indian studies in this domain and when compared to international studies, a strong need for revival of research has been felt. Aim: To evaluate language dysfunction among first-admission untreated patients of psychosis using the clinical language disorder rating scale (CLANG). Methodology: In this cross-sectional study, language dysfunction among 60 untreated psychotic patients who attended the psychiatry inpatient services of a tertiary care center from North India in the period from January 2022 to October 2023 were evaluated for the presence of language dysfunction using a valid tool called CLANG after taking approval from the Institutional Ethical Committee and with the informed consent of the patients and/or their caregivers. Data set for 60 patients regarding the sociodemographic-clinical profile and language dysfunction was obtained. The data was analyzed using descriptive and inferential statistics as appropriate. Results: Diagnosis-wise, most of our patients belonged to schizophrenia (n = 26) (43.33%). Rest of them psychotic disorders like bipolar affective disorder with psychotic symptoms (15%) and schizoaffective disorder (11.67%) to name a few. The most commonly affected language domains in our patients were referential failures (65%), discourse failures (46.67%) and lack of semantic association (16.67%). Schizophrenics were differentiated from non-schizophrenic psychosis patients based on lack of semantic association (exclusively seen in schizophrenics). Referential failures and discourse failures were commonly noted in both schizophrenia and non-schizophrenic psychotic disorders. Poverty of speech was rather predominant in mood disorders with psychotic symptoms. Conclusion: The findings of our study put emphasis on the fact that language dysfunction is a core component of the phenomenon of psychosis and perhaps revalidates the neural basis of psychosis. The domain ‘lack of semantic association’ was typically present in patients with a diagnosis of schizophrenia, while other language abnormalities like referential failures and abnormal prosody were generally present in patients of untreated psychosis.