Objective: Data on the temporal relationships between duration of depression and recovery and functional disability are sparse. These relationships were examined in subjects from the general population (n = 250) with newly originated episodes of DSM-III-R major depression. Method: The Netherlands Mental Health Survey and Incidence Study is a prospective epidemiological survey in the adult population (n = 7076), using the Composite International Diagnostic Interview (CIDI). Duration of depression and duration of recovery over 2 years were assessed with a life chart interview. Functional disabilities were assessed with the MOS-SF-36 and with absence days from work. Results: Functional disabilities and absence days in depressed individuals were not found to be associated with duration of depression. Functioning in daily activities improved with longer duration of recovery but social functioning not. Conclusion: Functioning deteriorates by actual depressive symptomatology and comorbid anxiety but not by longer duration of depression. After symptomatic recovery, functioning improves to premorbid level, irrespective of the length of the depression. Improvements in daily activities and work can be expected with longer duration of recovery.