This cross-sectional study examined the relationships between clinical and neuropsychological variables and self-reported quality of life (QoL) in 30 euthymic bipolar I patients, 23 remitted schizophrenic patients, and 23 healthy controls. Participants were administered the World Health Organization Quality of Life Measure-Abbreviated Version (WHOQOL-BREF) to assess QoL. Moreover, a broad neuropsychological battery was also administered. Bipolar disorder (BD) and schizophrenia patients demonstrated significantly lower scores on the physical, psychological, and social domains of the WHOQOL-BREF compared with controls, but there were no significant differences between the two patient groups on those domains. More symptomatic BD patients reported worse QoL, especially in the physical and environmental domains, which was also associated with worse neurocognitive performance. In schizophrenic patients, neurocognitive performance was not associated with self-reported QoL, but more symptomatic patients reported lower QoL. Substantial impairments in QoL, similar in severity, were found in both patient groups. In patients with schizophrenia, QoL was more strongly related to levels of psychopathology, whereas in BD patients, both psychopathology and neurocognitive deficits were strongly associated with lower QoL. Clinical recovery is essential in schizophrenia and BD. The association between cognitive functioning and QoL in bipolar patients suggests that these patients may also benefit from psychological interventions addressed to improve cognitive deficits and enhance the functional recovery.