We examined geographic variations in the dispensing of anxiolytics and hypnotics (AX-HY) and their determinants at the canton level in southeastern France. Data were collected from the 2005 outpatient database of the Southeastern France General Health Insurance Fund, covering more than 70% of the population. We calculated the annual age-adjusted prevalence rates of subjects filling prescriptions for AX-HY at least once (to measure ‘overall use’) and at least six times (‘chronic use’), assessed geographic variations with the extremal quotient and weighted coefficient of variation, and conducted simple and multiple linear regression analysis to study their determinants. Prevalence rates of overall and chronic AX-HY use were 15.5% and 5.9%, respectively, and varied significantly between cantons, by a factor of 3–4. The prevalence of mental illness and that of chronic illness were independently and positively associated with overall and chronic use; unemployment rates and mean family income were positively associated only with overall use. Density of general practitioners did not explain geographic variations. These results provide a basis for targeting interventions to reduce AX-HY use and promoting appropriate discontinuation. Future studies should examine trends in those geographic variations.