Objective: Individuals with co-occurring psychiatric and substance abuse problems often exhibit poor outpatient treatment engagement and re-hospitalization following discharge from acute psychiatric services. Although case management can improve treatment engagement and reduce attrition, these services are often delivered indefinitely, limiting the availability of treatment slots. In an effort to reduce re-hospitalization rates and improve outcomes during the transition from inpatient to outpatient treatment, we developed and evaluated Time-Limited Case Management (TLC), an eight-week integrated mental health and substance abuse augmentation intervention. Method: Sixty-five dually diagnosed veterans admitted to inpatient psychiatric treatment were included in the program evaluation, 32 who received the TLC service in addition to Treatment as Usual (TAU) that began during inpatient treatment and continued after the transition to outpatient services, and a comparison group of 33 who received only TAU without transitional support provided through the TLC augmentation service. Results: The TLC group had fewer days and episodes of hospitalization at two and six month post-study entry. Furthermore, the TLC group exhibited greater improvements on the Global Assessment of Functioning from baseline to the six-month follow-up. Conclusion: TLC appears to be an effective transitional augmentation service with benefits that persist beyond the eight weeks of the program. Future research should include a larger and more rigorously controlled trial to confirm the efficacy and unique contributions of the intervention.