This discussion paper explores the state of knowledge about the prevalence of mental illness and its effect on the working population. Major trends in the literature are also commented on, and significant gaps in knowledge are identified. Annually, 12% of Canadians from 15 to 64 years suffer from a mental disorder or substance dependence. Few studies have examined the prevalence of mental disorders among Canadian workers. Results from Ontario estimate that monthly, about 8% of the working population has a diagnosable mental disorder. Preliminary findings also indicate differences in the prevalence of mental disorders among workers with regard to occupation, age, sex, physical disorders, work environment and work-related stress. Studies indicate that mental and emotional health problems are associated with staggering social and economic costs, which create a heavy burden on the workplace. About one-third of society's depression-related productivity losses can be attributed to work disruptions. The impact of mental illness on the workplace has been examined in terms of its effect on presenteeism, absenteeism and disability days. The presence of any of these has been used to indicate decreased productivity, the largest burden arising from presenteeism. In total, Canada annually loses about $4.5 billion from this decreased productivity. Mental illness is also associated with short-term and long-term disability, which in turn is often related to insurance coverage. Mental illness related disability claims have doubled and mental illness accounts for 30% of disability claims, at a cost of $15 to $33 billion annually. The needs of the working population and employers must be addressed. We must be aware of patterns of mental disorder among occupational groups and industry sectors. In addition, we must understand how the disability benefit structure impacts the prevalence as well as patterns of disability related to mental illness. Effective policies and programs must be based on solid evidence.