Purpose of review In an effort to maximize the benefits gained from limited health care resources, economic evaluation is becoming an increasingly common feature of clinical trials. This paper explores growth in the quantity and quality of economic evaluations in the mental health field through a systematic review of all such evaluations published over a 12-month period. Recent findings Twenty-eight economic evaluations met the inclusion criteria for the review. Cost-effectiveness and cost-consequences analyses were the most commonly employed methods of economic evaluation. Only two cost-utility analyses were located, involving the calculation of cost per quality adjusted life year gained. Thus comparison of resource implications across broad areas of mental health are not possible. Only 11 randomized controlled trials were located, although strong economic evaluations employing other designs were found. Only six studies took a cost perspective that came close to being societal. Narrow perspectives were common, with few studies including assessment of patient and family costs, nonhealth care costs or productivity losses. Small and unjustified sample sizes and short follow-up periods were not uncommon, although there have been improvements in these areas of study design in comparison to earlier reviews. Summary Economic evaluations in mental health are more commonly undertaken and the methods employed are improving with time. However, there are still inadequate numbers of such evaluations to inform resource allocation decisions and poor methods are still common. Careful examination of the few good quality economic evaluations in existence may help to improve this situation in the future.