Background: Prevalence of negative symptoms in the early phase of schizophrenia remains uncertain. Negative symptoms are the primary cause of long term disability and poor functional outcome. The purpose of this study is to examine the presence of negative symptoms in patients with fist episode psychosis in schizophrenia who were hospitalized. Methods: Negative symptoms were measured in 72 patients presenting with FEP using the scale for assessment of negative symptoms (SANS) and ascertained diagnosis using DSM-IV. Prevalence of SANS items and subscales were examined for both schizophrenia and bipolar disorder. Results: This study shows that a significant number of patients with first episode schizophrenia had negative symptoms 66 (87.5%). All five subtypes of negative symptoms were present in 47% of patients suggesting primary negative symptoms, and about 40% have secondary negative symptoms. Independently, each subtype of negative symptoms was seen in 48% - 76% of patients. The most prevalent negative symptom in first-episode schizophrenia was found to be blunting (72%). 46% of patients had significant level of depression, overall psychopathology was severe and level of functioning was poor. We found that 45.8% patients were prescribed anticholinergic medications which indicated that at least 45% subjects had extra-pyramidal symptoms (EPS). Conclusion: Primary negative symptoms are prevalent in about half of First episode Psychosis (FEP) schizophrenia patients. These findings have implications for identification, early treatment, and reduced treatment resistance for negative symptoms in order to increase social and clinical outcome of schizophrenia. Further research is required in this area.