Objectives: Several lines of evidence suggest an adverse effect of psychotic episodes on brain morphology. It is not clear if this relationship reflects the cumulative effect of psychotic outbursts on the gradual progressive reduction of hippocampal tissue or an increased tendency toward psychotic episodes in patients with a smaller hippocampus at the beginning of the illness. Methods: This is a longitudinal 4-year prospective study of patients with first-episode schizophrenia (FES, N = 58). Baseline brain anatomical scans (at FES) were analysed using voxel-based morphometry and atlas-based volumetry of the hippocampal subfields. The effects of first-episode duration on the hippocampal morphology, and the effect of baseline hippocampal morphology on illness course with relapses, number of psychotic episodes and residual symptoms were analysed. Results: A significant negative correlation was detected between first-episode duration and baseline hippocampal morphology. Relapse, number of psychotic episodes and residual symptoms had no correlation with baseline hippocampal volume. Conclusions: We replicated the effect of psychosis duration on hippocampal volume already at the time first-episode, which supports the concept of toxicity of psychosis. The indices of a later unfavourable course of schizophrenia had no correlation with baseline brain morphology, suggesting that there is no baseline morphological abnormality of the hippocampus that predisposes the patient to frequent psychotic outbursts.