OBJECTIVES: There is little data describing current practice in the clinical management of patients with psychosis and co-occurring substance use and the associated costs. In the UK, standard psychiatric care is based on the care programme approach and includes community and hospital-based treatment. Inpatient psychiatric treatment is the key cost driver of psychiatric care. This study aimed to describe practice-based patient-level costs of inpatient psychiatric treatment for NHS patients with psychosis and co-occurring substance use. METHODS: Resource use data of inpatient psychiatric treatment were collected from the medical records of 327 patients recruited in the MIDAS trial, a randomised controlled trial of an experimental intervention programme (integrated motivational interviewing and cognitive-behaviour therapy, MiCBT) plus standard care or standard care alone. Using the hospital perspective, data were collected from trial entry until end of 2-year trial follow-up (between 2004 to 2009). Unit costs were assigned, based on NHS Reference Costs 2008/09 and PSSRU 2009. Data were analysed using descriptive statistics and variations around the costs were obtained. RESULTS: Of the 327 patients, 95 patients (29%) experienced at least one episode of hospitalisation, with a mean of 85 inpatient days (95% CI: 65 – 105, median 42, range 2 - 568) per hospitalised patient. Total cost for these 95 patients was £2.43million (UK £2008/09) over 8,108 inpatient days. Mean cost per hospitalised patient was £25,547 (95% CI: £18,453 – £32,640, median £12,180, range £580 – £273,208). Cost components comprised: acute psychiatric admission (total 6,428 days, £1.86million), psychiatric rehabilitation admission (total 621 days, £165,186), psychiatric long-stay admission (total 434 days, £91,574), psychiatric ICU admission (total 57 days, £32,832) and psychiatric forensic medium secure unit admission (568 days, £273,208). CONCLUSIONS: This study provided practice-based data describing patient-level costs associated with standard NHS care of inpatient psychiatric treatment for patients with psychosis and co-occurring substance use.