Objective: This study examined the association between socioeconomic deprivation and extended hospitalization in severe mental disorder, after taking account of confounding variables. Methods: A representative sample of 660 inpatients from South Auckland, New Zealand, was followed for two years from their index admission. Additional data were collected during the index admission for a subsample of 291 patients. Results: Greater levels of socioeconomic deprivation in the inpatient's neighborhood of residence was associated with extended hospitalization after adjustment for demographic factors and primary diagnosis but not after adjustment for comorbid diagnosis, chronicity, function, and severity. Most extended hospitalizations were related to poor illness recovery. Conclusions: People from more deprived areas are likely to need longer psychiatric admissions, mostly because of the association between deprivation and having more disabling symptoms and a comorbid psychiatric diagnosis. Interventions to prevent psychiatric hospitalization, reduce duration of stay, and enhance recovery must be tested among those with greater levels of socioeconomic deprivation. (Psychiatric Services 59:322—325, 2008)Abstract Teaser