Summary Background Isotretinoin is an efficacious treatment for acne, but has been controversially linked with depression. Objectives This study aimed to examine the effects of isotretinoin on quality of life (QoL) and depression using a prospective design. Methods The WHOQOL-BREF QoL measure and Centre for Epidemiological Studies Depression Scale were administered to consecutive outpatients with acne who were prescribed either isotretinoin (n = 65) or antibiotic treatment (n = 31). Patients and physicians rated acne severity independently. Groups were compared at baseline with a matched community sample (n = 94) and measurements repeated at 3 months for treatment groups. Results There were no differences between the three groups at baseline in terms of age, gender, depression or overall QoL. Acne was more severe in the treatment groups (P <0·001). Depression was negatively correlated with QoL (P <0·001) and hence was included as a covariate in repeated-measures analyses of QoL. Acne improved over time in both treatment groups (F = 48·2, P <0·001). There was no detectable deterioration in depression score in either group (F = 1·1, not significant). QoL in the physical and social domains improved (P <0·001) while psychological and environmental QoL was unchanged over time. The improvement in social QoL was greater in the isotretinoin group (P <0·05). Those patients with higher baseline depression scores showed greater improvements in physical, psychological and social QoL (P <0·001). Conclusions Treatment of acne improves QoL, particularly in those with more depressive symptoms at the outset. Mood deterioration was not detected, but the possibility of subtle or rare mood effects of isotretinoin cannot be ruled out. © 2010 British Association of Dermatologists.