This analysis compared the effectiveness (treatment discontinuation and hospitalization) of depot and oral typical antipsychotics in nonadherent outpatients with schizophrenia. Data from the 3-year, prospective, observational Schizophrenia Outpatient Health Outcome study were used. Time to treatment discontinuation, percentage of patients hospitalized and the mean numbers of hospitalizations were compared for previously nonadherent patients initiating depot typical or oral typical monotherapy. Cox proportional hazards, linear and logistic regression models were used to adjust for differences between the treatment groups at the index visit. Of 1642 nonadherent patients, 431 (26%) started an oral typical (n=169) or depot typical (n=262) antipsychotic and were included in the analysis. After adjusting for index variables, treatment discontinuation was significantly lower in the depot typical cohort (hazard ratio: 0.72, 95% confidence interval: 0.54–0.97, P<0.05). Younger age and more severe positive symptoms were also associated with higher discontinuation. The frequency of hospitalization and the mean number of hospitalizations were both significantly lower for the depot typical cohort at 6 months (P<0.05) compared with oral typicals. In the usual care of outpatients with schizophrenia, treatment continuation among nonadherent patients is longer for depot typicals compared with oral typicals and is accompanied by less hospitalization in the short term.