Objective: The aim of this study was to report nationally representative data on the prevalence and patterns of 12 month comorbidity of chronic physical conditions (diabetes, asthma, coronary heart disease, stroke, cancer, arthritis) and DSM-IV affective and anxiety disorders in Australian adults. Method: The 2007 National Survey of Mental Health and Wellbeing (NSMHWB) was a nationally representative household survey of 8841 Australian adults (1685 years) assessing symptoms of ICD-10 mental disorders and the presence of chronic physical conditions. Results: Prevalence of at least one National Health Priority Area chronic physical condition was 32.2% (95%CI = 30.9%33.5%). Among those with chronic physical conditions 21.9% had an affective or anxiety disorder. Affective and anxiety disorders were more common among people with physical conditions than among people without chronic physical conditions (affective OR 1.5; anxiety OR 1.8). Of those with a 12 month affective or anxiety disorder, 45.6% had a chronic physical condition. Physical disorders were more common in those with an affective or anxiety disorder than among people without an affective or anxiety disorder (affective OR 1.6; anxiety OR 2.0). Disability was high in those with an anxiety disorder, an affective disorder and a physical condition and 43.4% were classified as high service users. Conclusions: Comorbidity between chronic physical conditions and affective and anxiety disorders is widespread and is associated with high levels of disability and service use.