Individuals with chronic fatigue syndrome (CFS) face chronic physical debilitation, reduced neuropsychological functioning, and changes in emotional well-being that significantly detract from quality of life. The role of psychiatric disturbance in reducing quality of life in CFS remains unclear. In the current investigation, the role of psychiatric status in reducing health-related quality of life in CFS was examined. Four subject groups were compared on measures of functional well-being, mood, and neuropsychological status: individuals with CFS and no history of psychiatric illness, individuals who had current symptoms of psychiatric illness that began after their CFS diagnosis, individuals who had current symptoms of psychiatric illness that began before their CFS diagnosis, and a healthy sedentary control group. Overall, it was found that individuals with CFS suffer from profound physical impairment. Concurrent psychiatric illness, however, did not adversely affect physical functional capacity. Physical functional capacity was not worse in individuals with a concurrent psychiatric illness. As expected, concurrent psychiatric illness was found to reduce emotional well-being. Moreover, individuals with a psychiatric illness that predated the onset of CFS suffered the greatest emotional distress. Thus, an individual’s psychiatric history should be considered when attempting to understand the factors maintaining disability in CFS.