Background: Health literacy (HL) is considered a key concept to positively address relevant decisions concerning physical and mental health. According to an integrated model of a European Consortium, the process to access, understand, appraise and apply health information is at the centre of practising HL. Aim: In this study, we examine HL in a population with an early onset of a mental disorder (MD). Methods: Results are based on a cross-sectional survey among people with MD ( n = 310) who sought help at an early detection centre for MD in Cologne, Dresden or Munich. Help-seekers filled out the European Health Literacy Survey questionnaire (HLS-EU-Q) on perception-based HL, socio-demographic data and general health status. Psychopathology was assessed separately by trained specialists. Data are compared with a representative sample of the German population. Results: Overall, HL was lower in a sample with MD compared with the general population. Disease-specific limitations were present in accessing, appraising and applying health information, whereas understanding was perceived fairly easy. Statistical analysis of limited HL revealed correlations with the diagnosis of affective disorders and anxiety disorders, an increase of depressive symptoms as well as the presence of more than one MD. In line with these findings, low levels of HL were associated with a worse general health status. Conclusion: In a population with MD, accessing, appraising and applying health information seemed to be particularly challenging. Therefore, educational programmes that mainly focus on increasing knowledge might not be sufficient for improving the HL in people with MD. Further research should concentrate on context-specific HL to foster behavioural change and improve overall health.