The objective of this paper was to examine the prognostic significance of borderline personality disorder (BPD) and substance abuse in a cohort of former inpatients screened for BPD and followed up prospectively seven years after the index admission. The impact of comorbidity on borderline psychopathology, impulsivity and psychosocial functioning was examined. The original cohort was assembled between April 1983 and December 1985. Admissions were screened for borderline characteristics which resulted in a sample of 130 subjects, 88 of whom were positive for BPD based on the Diagnostic Interview for Borderlines. At seven years follow-up, 81 out of 130 (62.3%) subjects were re-interviewed. Six (4.6%) had committed suicide, two (1.5%) were deceased and 41 (31.6%) were lost to follow-up. The subjects with BPD and substance abuse were significantly differentiated from subjects with BPD only, substance abuse only and neither disorder on the basis of demonstrating more borderline psychopathology and more self-destructive and suicidal thoughts and behaviours. Probands with initial diagnoses of BPD and substance abuse were twice as likely to be diagnosed BPD on follow-up as probands with initial diagnosis of BPD only (relative risk = 2.19, 95% CI, 1.21 to 3.97). These findings and other research suggest that patients with comorbid BPD and substance abuse should be encouraged to focus on their abuse problems as a priority.