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Background: Elevated risk of psychosis for ethnic minority groups has generally been shown to be mitigated by high ethnic density. However, past survey studies examining UK Pakistani populations have shown an absence of protective ethnic density effects, which is not observed in other South Asian groups., Aims: To assess the ethnic density effect at a local neighbourhood level, in the UK Pakistani population in East Lancashire., Method: Data was collected by the East Lancashire Early Intervention Service, identifying all cases of first episode psychosis (FEP) within their catchment area between 2012 and 2020. Multilevel Poisson regression analyses were used to compare incidence rates between Pakistani and White majority groups, while controlling for age, gender and area-level deprivation. The ethnic density effect was also examined by comparing incidence rates across high and low density areas., Results: A total of 455 cases of FEP (364 White, 91 Pakistani) were identified. The Pakistani group had a higher incidence of FEP compared to the White majority population. A clear effect of ethnic density on rates of FEP was shown, with those in low density areas having higher incidence rates compared to the White majority, whereas incidence rates in high density areas did not significantly differ. Within the Pakistani group, a dose-response effect was also observed, with risk of FEP increasing incrementally as ethnic density decreased., Conclusions: Higher ethnic density related to lower risk of FEP within the Pakistani population in East Lancashire, highlighting the impact of local social context on psychosis incidence.