BACKGROUND Although there have been many studies of work demands and self-reported job strain, few have examined incident physician-diagnosed mental ill-health (MIH) by detailed occupational group. OBJECTIVE To investigate whether linkage of occupation from worker compensation claims to diagnoses from administrative health records can give credible information on occupation and incidence of MIH by diagnostic group and gender. METHODS Information on occupation from all worker compensation claims 1995-2004 in Alberta, Canada were linked to administrative health records of MIH diagnoses. Relative risks for affective, substance use and psychotic disorders by four digit occupational codes were calculated for men and women aged 18-65 years in a log-binomial regression adjusting for age and stratifying by sex. RESULTS There were 327883 male and 88483 female compensation claims available for the analysis of incident cases. Affective disorders (5.2% men, 11.5% women) were much more common than substance use disorders or psychotic disorders (both ≤1%) in this population of working people. In men, the type of work appeared to either protect from or precipitate affective disorders, but no protective effect was seen for women. Substance use disorders clustered mainly in physically demanding occupations typically involving employment outside the urban areas. New onset psychotic disease was rare but seen in excess in painters, boilermakers and chefs. CONCLUSIONS Data linkage of occupation close to the time of new onset MIH can provide important insight into the relation between work and physician-diagnosed MIH and indicate areas in which intervention might be appropriate.