Background: Little is known about predictors of recovery from bipolar depression. Aims: We investigated affective instability (a pattern of frequent and large mood shifts over time) as a predictor of recovery from episodes of bipolar depression and as a moderator of response to psychosocial treatment for acute depression. Method: A total of 252 out-patients with DSM-IV bipolar I or II disorder and who were depressed enrolled in the Systematic Treatment Enhancement Program for Bipolar Disorder (STEP-BD) and were randomised to one of three types of intensive psychotherapy for depression (n= 141) or a brief psychoeducational intervention (n =111). All analyses were by intention-to-treat. Results: Degree of instability of symptoms of depression and mania predicted a lower likelihood of recovery and longer time until recovery, independent of the concurrent effects of symptom severity. Affective instability did not moderate the effects of psychosocial treatment on recovery from depression. Conclusions: Affective instability may be a clinically relevant characteristic that influences the course of bipolar depression. Declaration of interest L. S. served as a consultant for Bracket Global and Clintara. M.O. has served as a consultant for MicroTransponder Inc. E.F. has served as a consultant for Servier International. M.B. has received research support from Bristol-Myers Squibb (BMS), Eli Lilly, GlaxoSmithKline (GSK), Organon, Novartis, MaynePharma and Servier, has been a speaker for AstraZeneca, BMS, Eli Lilly, GSK, Janssen Cilag, Lundbeck, Merck, Pfizer, Sanofi Synthelabo, Servier, Solvay and Wyeth, and served as a consultant to AstraZeneca, BMS, Eli Lilly, GSK, Janssen Cilag, Lundbeck Merck and Servier. A.A.N. has received honoraria or travel expenses from: American Society of Clinical Psychopharmacology, Australasian Society for Bipolar Disorder, Bayamon Region Psychiatric Society, Belvoir Publishing, Boston Center for the Arts, Corcept, Controlled Risk Insurance Company, Dartmouth, Dey Pharma L.P./Mylan Inc, Israel Society for Biological Psychiatry, Johns Hopkins University, National Association of Continuing Education, PAI, Pamlabs, Physicians Postgraduate Press, Ridge Diagnostics, Slack Publishing, Sunovion, Teva Pharmaceuticals, University of Florida, University of Michigan, University of New Mexico, University of Miami, University of Wisconsin, Wolters Klower Publishing. Potential consulting honoraria from AstraZeneca, BMS, Forest, Pfizer, Ridge Diagnostics. Potential support of research at Massachusetts General Hospital (MGH) through Biogen Idec, Dey Pharmaceuticals, Pamlabs, Shire and Sunovian. He owns stock options in Appliance Computing Inc (MindSite.com) and Brain Cells Inc. Additional income is possible from Infomedic.com but no revenue has been received to date. Through MGH, A.A.N. is named for copyrights to: the Clinical Positive Affect Scale and the MGH Structured Clinical Interview for the Montgomery-åsberg Depression Scale exclusively licensed to the MGH Clinical Trials Network and Institute (CTNI). T.D. has received honoraria, consultation fees and/or royalties from the MGH Psychiatry Academy, Brain Cells Inc, Systems Research and Applications Corporation, Boston University, the Catalan Agency for Health Technology Assessment and Research, the National Association of Social Workers Massachusetts, the Massachusetts Medical Society, Tufts University and National Institute on Drug Abuse. He has also participated in research funded by National Institutes of Health, National Institute on Aging, Agency for Healthcare Research and Quality, Janssen Pharmaceuticals, The Forest Research Institute, Shire Development Inc, Medtronic, Cyberonics and Northstar.