Background: While adult atopic dermatitis (AD) is associated with anxiety and depression, and paediatric AD is linked to attention deficit hyperactivity disorder (ADHD), the relationship between AD in childhood and other psychiatric disorders is largely unknown. Objectives: To determine the relationship between AD and diagnosis and treatment of psychiatric disorders in children. Methods: All Danish children born between 1 January 1995 and 31 December 2012 with a hospital diagnosis of AD (n = 14 283) were matched 1 : 10 with children without a hospital diagnosis of AD. Endpoints were psychotropic medication use, hospital diagnoses of depression, anxiety, ADHD, or self-harming behaviour, accidental/suicidal death, and consultation with a psychiatrist or psychologist. Results: Significant associations were observed between hospital-diagnosed AD and antidepressant [adjusted hazard ratio (aHR) 1·19, 95% confidence interval (CI) 1·04–1·36], anxiolytic (aHR 1·72, 95% CI 1·57–1·90), and centrally acting sympathomimetic (aHR 1·29, 95% CI 1·18–1·42) medication use. Consultation with a psychiatrist (aHR 1·33, 95% CI 1·16–1·52) or psychologist (aHR 1·25, 95% CI 1·11–1·41) was also associated with AD. No association with a hospital diagnosis of depression (aHR 0·58, 95% CI 0·21–1·56), anxiety (aHR 1·47, 95% CI 0·98–2·22) or self-harming behaviour (aHR 0·88, 95% CI 0·27–2·88) was observed, but a diagnosis of ADHD (aHR 1·91, 95% CI 1·56–2·32) was significantly associated with AD. The absolute risks were generally low. Conclusions: The increased risk of treatment, but not of a hospital diagnosis of psychiatric disorders in children with hospital-diagnosed AD, suggests that psychiatric issues in children with AD could be of a transient, reversible or mild–moderate nature.