For people with mental illness, experiences of homelessness can complicate mental health recovery processes. This study used longitudinal data from a randomized controlled trial of housing first (HF) to examine predictors of recovery among homeless people with mental illness. Findings showed that health and community predictors were most strongly associated with mental health recovery. Receipt of HF did not have any effect on changes in recovery scores at follow-up. Overall, the findings suggest that interventions aimed at preventing chronic homelessness, strengthening social networks and community involvement, and providing case management services will facilitate mental health recovery.