Background: Abnormal glutamate and GABA (gamma-aminobutyric acid) levels have been found in the early phase of schizophrenia and may underlie cognitive deficits. However, the association between cognitive function and levels of glutamatergic metabolites and GABA has not been investigated in a large group of antipsychotic-naïve patients. Methods: In total, 56 antipsychotic-naïve patients with schizophrenia or psychotic disorder and 51 healthy control subjects underwent magnetic resonance spectroscopy to measure glutamate, glutamate+glutamine (Glx), and GABA levels in dorsal anterior cingulate cortex (ACC) and glutamate and Glx levels in left thalamus. The cognitive domains of attention, working memory, and IQ were assessed. Results: The whole group of antipsychotic-naïve patients had lower levels of GABA in dorsal ACC (p = .03), and the subgroup of patients with a schizophrenia diagnosis had higher glutamate levels in thalamus (p = .01), but Glx levels in dorsal ACC and thalamus did not differ between groups. Glx levels in dorsal ACC were positively associated with working memory (logarithmically transformed: b = −.016 [higher score indicates worse performance], p = .005) and attention (b = .056, p = .035) in both patients and healthy control subjects, although the association with attention did not survive adjustment for multiple comparisons. Conclusions: The findings suggest a positive association between glutamatergic metabolites and cognitive function that do not differ between patients and healthy control subjects. Moreover, our data indicate that decreased GABAergic levels in dorsal ACC are involved in schizophrenia and psychotic disorder, whereas increased glutamate levels in thalamus seem to be implicated in schizophrenia pathophysiology. The findings imply that first-episode patients with cognitive deficits may gain from glutamate-modulating compounds.