The performance of partition-spreading CDMA (PS-CDMA), a recently proposed multiple-access system, is investigated. It is shown via variance evolution that the asymptotic channel throughput of PS-CDMA improves monotonically as the number of partitions increases. The fundamental limit of the PS-CDMA system is calculated by evaluating the spectral efficiency of the layered channel that is generated by multistage PS-CDMA demodulation. Capacity-approaching codes of high rate are suggested in the encoding for each PS-CDMA user, which justifies a low-complexity two-stage decoding scheme for PS-CDMA.