Despite proven advantages for the use of telemedicine in psychiatry, mental healthcare professionals have shown deep-seated mistrust and suspicion of telepsychiatry, which hinders its widespread application. The current study examines the attitudes of Israeli mental health professionals towards telepsychiatry and seeks to uncover the effects of experience and organizational affiliation on its adoption. The methodology included qualitative and thematic analysis of 27 in-depth interviews with Israeli mental health professionals, focusing on three major themes—clinical quality, economic efficiency, and the effects on the work–life balance of healthcare professionals. The attitudes of mental health professionals were found to be widely divergent and sharply dichotomized regarding different aspects of telepsychiatry and its suitability for mental healthcare services. However, there was a general consensus that telemedicine may not fulfil its promise of being a panacea to the problems of modern public medicine. In addition, attitudes were related to hierarchical position, organizational affiliation, and personal experience with telepsychiatry. Specifically, organizational affiliation influenced experience with and support for the assimilation of telepsychiatry. The study also revealed the role of organizational leadership and culture in promoting or inhibiting the proliferation and adoption of innovative technologies and services in modern medicine.