Objective: Posttraumatic stress disorder (PTSD) is a potentially disabling mental illness that can cause occupational dysfunction. Although vocational rehabilitation is often prescribed for patients with PTSD, standard vocational services are far from adequate in helping them obtain and maintain competitive employment. This study is the first to examine the outcome of evidence-based supported employment for veterans with PTSD. Methods: Unemployed veterans with PTSD were randomly assigned to either individual placement and support (IPS) supported employment (N=42) or a Veterans Health Administration Vocational Rehabilitation Program (VRP) treatment as usual (N=43). Employment rates and occupational outcomes were followed for 12 months. Results: During the 12-month study, 76% of the IPS participants gained competitive employment, compared with 28% of the VRP participants (number needed to treat=2.07; χ 2=19. 84, df=1, p<.001). Veterans assigned to IPS also worked substantially more weeks than those assigned to VRP (42% versus 16% of the eligible weeks, respectively; Mann-Whitney z test p<.001) and earned higher 12-month income (mean±SD income of $9,264±$13,294 for IPS versus $2,601±$6,009 for VRP; Mann-Whitney z test p<.001) during the 12-month period. Conclusions: Veterans with PTSD who received IPS were 2.7 times more likely to gain competitive employment than those who received VRP. Because work is central to recovery, these results should assist stakeholders in planning improved services for veterans with PTSD.