Aims To examine prospectively the contribution of the recreational social environment to ecstasy initiation. Design Population-based retrospective/prospective cohort study. Setting Data from screening an Australian young adult population to obtain samples of users and non-users of ecstasy. Participants A sample of 204 ecstasy-naive participants aged 19-23 years was obtained, and a 6-month follow-up identified those who initiated ecstasy use. Measurements We assessed a range of predictors of ecstasy initiation, including elements of participants' social environment, such as ecstasy-using social contacts and involvement in recreational settings. Findings More than 40% of ecstasy-naive young adults reported ever receiving ecstasy offers. Ecstasy initiation after 6 months was predicted independently by having, at recruitment, many ecstasy-using social contacts [adjusted relative risk (ARR) 3.15, 95% confidence interval (CI): 1.57, 6.34], attending electronic/dance music events (ARR 6.97, 95% CI: 1.99, 24.37), receiving an ecstasy offer (ARR 4.02, 95% CI: 1.23, 13.10), early cannabis use (ARR 4.04, 95% CI: 1.78, 9.17) and psychological distress (ARR 5.34, 95% CI: 2.31, 12.33). Adjusted population-attributable fractions were highest for ecstasy-using social contacts (17.7%) and event attendance (15.1%). Conclusions In Australia, ecstasy initiation in early adulthood is associated predominantly with social environmental factors, including ecstasy-using social contacts and attendance at dance music events, and is associated less commonly with psychological distress and early cannabis use, respectively. A combination of universal and targeted education programmes may be appropriate for reducing rates of ecstasy initiation and associated harms.