Abstract: Metabolic effects are generally more pronounced with second-generation than first-generation antipsychotics. This study was designed to compare long-term metabolic effects and efficacy of paliperidone extended release (ER) with those of oral olanzapine in patients with schizophrenia. In this 6-month, multicenter, prospective, randomized, controlled, open-label, parallel-group study, adults with schizophrenia were treated with paliperidone ER (6–9 mg/d; n = 239) or oral olanzapine (10–15 mg/d; n = 220). The primary outcome was mean change in the ratio of serum triglyceride level to high-density lipoprotein level (TG/HDL), a marker of insulin resistance. Other outcome measures included the Positive and Negative Syndrome Scale scores, measures of lipid and glucose metabolism, and body weight. Significant improvements in psychotic symptoms were observed with both treatments (P < 0.0001). The TG/HDL ratio was significantly higher at end point versus baseline with olanzapine compared with that of paliperidone ER. Mean end point change in TG/HDL ratio was 0.097 ± 2.72 for olanzapine (P < 0.0001, reflecting worsening), with no significant change for paliperidone ER (−0.17 ± 2.51). Newly diagnosed impairment in TG and metabolic syndrome was more common with olanzapine (P < 0.05). Insulin resistance, as measured by the homeostasis model assessment of insulin resistance, worsened significantly with olanzapine (P = 0.0003), but not with paliperidone ER. Glucose sensitivity for insulin worsened significantly with olanzapine (P < 0.03), with no significant changes for paliperidone ER. End point increase in body weight was significantly higher with olanzapine than paliperidone ER (3.8 vs 1.2 kg; P = 0.0013). In summary, both paliperidone ER and olanzapine effectively treated schizophrenia; however, undesirable metabolic effects were significantly greater with olanzapine.