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‘Recreational’ use of ketamine is spreading rapidly among young people. In healthy individuals an acute dose of the N-methyl D-aspartate (NMDA) receptor antagonist ketamine induces marked psychosis-like effects and cognitive impairments, but little is known about the long-term effects of the drug.To evaluate the long-term neuropsychiatric or cognitive consequences.A total of 150 individuals were assessed, 30 in each of five groups: frequent ketamine users, infrequent ketamine users, abstinent users, polydrug controls and non-users of illicit drugs. Twelve months later, 80% of these individuals were re-tested.Cognitive deficits were mainly observed only in frequent users. In this group, increasing ketamine use over the year was correlated with decreasing performance on spatial working memory and pattern recognition memory tasks. Assessments of psychological wellbeing showed greater dissociative symptoms in frequent users and a dose–response effect on delusional symptoms, with frequent users scoring higher than infrequent, abstinent users and non-users, respectively. Both frequent and abstinent using groups showed increased depression scores over the 12 months.These findings imply that heavy use of ketamine is harmful to aspects of both cognitive function and psychological wellbeing. Health education campaigns need to raise awareness among young people and clinicians about these negative consequences of ketamine use.