To evaluate the relationship between hypothyroidism and depression, thyroid function was evaluated in 250 consecutive patients referred to a psychiatric hospital for treatment of depression or anergia. Twenty of the 250 patients had some degree of hypothyroidism. Two patients (less than 1%) were identified with grade 1 (overt); nine patients (3.6%), grade 2 (mild); and ten patients (4%), grade 3 (subclinical) hypothyroidism. These results suggest that a significant proportion of patients with depression and anergia may have early hypothyroidism, the cases of about half of which are detected only by thyrotropin-releasing hormone (TRH) testing. Because hypothyroidism can produce signs and symptoms of depression and can coexist as a second illness in depressed patients, patients with early hypothyroidism may be candidates for thyroid replacement therapy. Clinical examination and measurement of triiodothyronine resin uptake thyroxine and baseline thyroid-stimulating hormone (TSH) levels, and TSH response to TRH are necessary to identify candidates for thyroid replacement among cases diagnosed by descriptive criteria as having either major or minor depression, particularly those that are atypical or treatment resistant.