International development policy has neglected mental health and its relationship with poverty, particularly in low- and middle-income countries. This is despite emerging evidence that poverty is strongly associated with mental illness in a vicious cycle that affects millions of people throughout their life course. The social conditions of poverty increase the risk of mental illness and, conversely, people living with mental illness are more likely to drift into, or remain in, poverty as a result of their disability and the associated stigma. There is compelling evidence that mental health treatment and rehabilitation can improve individual and household economic outcomes in low- and middle-income countries. This evidence supports calls to scale-up mental healthcare and place mental health on national and international development agendas.