Abstract Psychosis is a debilitating chronic illness associated with marked impairments of functional capacity in individuals and a significant economic burden for society. Despite various treatment options to address the positive symptoms of the illness, relatively few have been successfully developed to target cognitive symptoms that account for significant deficits in social and occupational functioning. Recent work suggests that deficits in bottom-up visual perceptual processes contribute to these more established cognitive impairments and their associated functional decline. Furthermore, distortions in visual perception have a significant clinical impact, particularly during early stages of the illness, despite being underappreciated in traditional clinical settings. Unfortunately, our limited understanding of the relationship between perceptual and cognitive systems in psychosis hinders our ability to isolate targets for therapeutic interventions. The proposed study will examine disruptions in bottom-up perceptual responses emerging from local cortical processes in addition to their modulation by coordinated activity across a distributed attentional network and ascertain the impact of each on clinical outcomes in first-episode psychosis. Response amplification in visual contrast perception, a well- documented disruption in chronic psychosis with implications for treatment of the disorder, remains understudied at disease onset. Moreover, the top-down modulation of this fundamental perceptual mechanism remains unexplored in psychotic illness despite significant literature detailing the facilitation of contrast perception via attention in healthy populations. I hypothesize that this modulation, mediated by long-range cortical communication across a distributed visual attention network, will exhibit marked disruption and be more closely associated with cognitive and functional deficits in early psychosis compared to disruptions in local perceptual responses. I will use simultaneously recorded M/EEG data to localize regions of visual cortex exhibiting altered stimulus contrast processing. This approach will also be used to isolate sources of impaired connectivity across regions of the dorsal attention network underlying the modulation of contrast perception by attention in healthy adults. Finally, symptoms and functional impairments will be assessed using validated clinical instruments to quantify the clinical impact of these visual processing deficits in first-episode patients. Identifying the various levels of information processing at which dysfunctions arise in psychosis is key to elucidating the mechanisms underlying its least well treated yet most devastating symptoms. Results from this study will inform interventional approaches targeting specific disruptions in visual processing associated with negative clinical outcomes. Examining disruptions at an early illness stage will help disambiguate the effects of primary disease processes from ...