Psychosis and psychosis-proneness are associated with abnormalities in subjective experience of the self, including distortions in bodily experience that are difficult to study experimentally due to lack of structured methods. In 55 healthy adults, we assessed the relationship between self-reported psychosis-like characteristics and susceptibility to the rubber hand illusion of body ownership. In this illusion, a participant sees a rubber hand being stroked by a brush at the same time that they feel a brush stroking their own hand. In some individuals, this creates the bodily sense that the rubber hand is their own hand. Individual differences in positive (but not negative) psychosis-like characteristics predicted differences in susceptibility to experiencing the rubber hand illusion. This relationship was specific to the subjective experience of rubber hand ownership, and not other unusual experiences or sensations, and absent when a small delay was introduced between seeing and feeling the brush stroke. This indicates that individual differences in susceptibility are related to visual-tactile integration and cannot be explained by differences in the tendency to endorse unusual experiences. Our findings suggest that susceptibility to body representation distortion by sensory information may be related or contribute to the development of psychosis and positive psychosis-like characteristics.