The present chapter explores the relationship between cognitive impairment and psychosocial functioning in schizophrenia. Despite advances in treatments, achieving real-life functional goals remains challenging for persons with schizophrenia, while current treatment goals emphasize recovery, including clinical, social, and personal aspects. There is consolidated evidence that impairments in neurocognition and social cognition impact real-life functioning more than psychotic symptoms; however, these domains are not routinely assessed and treated in clinical practice. Cognitive dysfunctions appear early in the course of illness, often predate the onset of psychosis, are associated with poor premorbid adjustment, and predict worse outcomes. Most cognitive domains, such as processing speed, attention, memory, and executive functions, are associated with poor functioning. Social cognition, in addition to its direct effect on real-life functioning, also mediates the relationships between neurocognitive subdomains and functioning, highlighting the need for holistic treatment. Negative symptoms and factors like social support also seem to have an impact on cognitive dysfunctions. Many tools for the assessment of cognition are available, though there is no consensus on a specific one, especially in the context of clinical practice. In conclusion, the present chapter highlights the importance of neurocognition and social cognition assessment and treatment in the context of integrated pathways of care to improve quality of life and the rates of recovery in people with schizophrenia.