Objective Although early intervention from the beginning of a psychotic episode is essential for a better prognosis, biomarkers predictive of symptomatic and functional improvement in early psychotic disorders are lacking. This study aimed to investigate whether the spectral power of resting-state electroencephalography (EEG) can be used as a predictive marker of the 1-year prognosis in patients with first-episode psychosis (FEP). Methods Twenty-four patients with FEP and matched healthy control (HC) subjects were examined with resting-state EEG at baseline. The symptomatic severity and functional status of FEP patients were assessed at baseline and reassessed after 1 year of usual treatment. Repeated measures analysis of variance was conducted to compare EEG spectral powers across the groups. Multiple regression analysis revealed EEG spectral powers predictive of symptomatic and functional improvement in FEP patients at the 1-year follow-up. Results Delta band power in the frontal and posterior regions was significantly higher in patients with FEP than in HCs. Higher delta band power in the posterior region predicted later improvement of positive symptoms and general functional status. Lower delta band power in the frontal region predicted improvement of negative symptoms and general functioning after 1 year. Conclusion These results suggest that increased delta absolute power is observed from the beginning of psychotic disorders. Furthermore, decreased delta power in the frontal region and increased delta power in the posterior region might be used as a predictive marker of a better prognosis of FEP, which would aid early intervention in clinical practice.