The co-occurrence of posttraumatic stress disorder (PTSD) and substance use is related to poorer outcome and increased dropout from trauma-focused treatment. Investigating PTSD and substance use can inform the intervention approaches. Exploring cannabis use in particular is especially important because rates of cannabis use have been increasing with recent legalization trends. A better understanding of how substance use is associated with treatment processes and outcome for individuals with PTSD is needed to enhance care. In this study, both lifetime diagnoses of alcohol and drug use disorders and current alcohol and drug use severity were examined in 200 men and women with chronic PTSD who received either prolonged exposure (PE) or sertraline. No lifetime or current alcohol use variables predicted dropout, adherence, or poorer outcome. However, lifetime diagnosis of both an alcohol and drug disorder (OR = 3.42) and recent cannabis use (OR = 3.38) strongly predicted higher dropout. Recent cannabis use and drug use severity predicted poorer adherence to PE (β = -.22 to -.29) but not to sertraline. Drug use severity (β = -.22) also predicted worse treatment outcome, as did lifetime diagnosis of an alcohol and drug disorder (β = -.48). Overall, patients with drug use improved with treatment but had less treatment retention, adherence, and symptom reduction. Strategies to increase engagement and retention may be indicated for these patients. Individuals who are using cannabis or other drugs may be at higher risk for not completing PTSD treatment, potentially prolonging the cycle of PTSD and substance use. (PsycINFO Database Record