Objective: To determine the prevalence of psychiatric disorders in new neurological inpatients and outpatients, and examine whether they are recognised, treated, or referred to psychiatric consultation. Methods: 198 consecutive patients referred for the first time to a neurologist were studied using a two phase design. ICD-10 psychiatric diagnoses were established by means of the SCAN (Schedules for Clinical Assessment in Neuropsychiatry). Results: The overall prevalence of current mental disorders was 55.1% (95% CI: 46.2 to 63.8), and 65.0% (95% CI: 56.1 to 73.0) had at least once in their life had a psychiatric disorder. The most frequent current diagnoses were somatoform disorders (33.8%, (95% CI: 25.9 to 42.7%)), followed by phobias (21.8%; 95% CI: 15.3 to 30.0), substance use disorders (13.3%; 95% CI: 8.3 to 20.6) and depression/dysthymia (14.4; 95% CI: 9.1 to 21.8). The psychiatric morbidity markedly declined with increasing age. Compared with 63.5% of the women, 46.4% of the men had a psychiatric disorder. Substance use disorders were more frequent in men than women (p=0.002). Patients with a psychiatric disorder were more frequently seen in the outpatients’ clinic than those without. The neurologists detected 14%–40% of the cases, 16.9% were in treatment, and only 4.6% were referred to mental health care. Conclusion: Psychiatric disorders, in particular somatoform disorders, are extremely common in neurological patients, especially in young and middle aged patients, outpatients, and women. The results call for more research on mental illness’ impact on care and outcome in neurological patients.