BackgroundThe economic burden of psychotic disorders is not well documented in LMICs like India, due to several bottlenecks present in Indian healthcare system like lack of adequate resources, low budget for mental health services and inequity in accessibility of treatment. Hence, a large proportion of health expenditure is paid out of pocket by the households. ObjectiveTo evaluate the direct and indirect costs incurred by patients with First Episode Psychosis and their families in a North Indian setting. MethodDirect and Indirect costs were estimated for 87 patients diagnosed at AIIMS, New Delhi with first-episode psychosis (nonaffective) in the first- and sixth month following diagnosis, and the six months before diagnosis, using a bespoke questionnaire. Indirect costs were valued using the Human Capital Approach. ResultsMean total costs in month one were INR 7991 ($107.5). Indirect costs were 78.3% of this total. Productivity losses was a major component of the indirect cost. Transportation was a key component of direct costs. Costs fell substantially at six months (INR 2732, Indirect Costs 61%). Respondents incurred substantial costs pre-diagnosis, related to formal and informal care seeking and loss of income. ConclusionFamilies suffered substantial productivity loss. Care models and financial protection that address this could substantially reduce the financial burden of mental illness. Measures to address disruption to work and education during FEP are likely to have significant long-term benefits. Families also suffered prolonged income loss pre-diagnosis, highlighting the benefits of early and effective diagnosis.