Evidence on the association between socio-economic status and the prevalence of neurotic disorder is contradictory. We studied the association between three elements of socio-economic status and the prevalence of neurotic psychiatric disorder in a representative sample of adults aged 16-64 living in private households in the UK. A cross-sectional survey of 10,108 adults aged 16-65 resident in private households in the UK was selected by a multi-stage, clustered, random-sampling design. Neurotic disorders were defined using a standardised interview, the revised clinical interview schedule (CIS-R). Data for 9570 people were available for this study. We used housing tenure and access to cars as measures of standard of living; both were associated with the prevalence of neurotic disorder even after adjustment for other socio-economic and demographic variables, including the Registrar General's Social Class and educational attainment. Those people with no access to a car had an odds ratio for neurotic disorder of 1.4 (95% CI 1.1-1.7), compared with those who had access to two or more cars. People who rented their homes were also at increased risk (1.3 [1.1-1.5]). We estimated that about 10% of the neurotic disorder in the UK could be attributed to the increased prevalence of those without cars who rented their homes. There was a complex interaction between the Registrar General's Social Class and sex, and there was no independent association with educational attainment. There is an independent association between low standard of living and the prevalence of neurotic psychiatric disorder. The UK has experienced one of the largest increases in income inequality within western market economies over the past 20 years, and this inequality may have had adverse consequences for the mental health of the population.