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HIV/AIDS‐related (HAR) stigma is still a prevalent problem in Sub‐Saharan Africa, and has been found to be related to mental health of HIV‐positive individuals. However, no studies in the Sub‐Saharan African context have yet examined the relationship between HAR stigma and mental health among HIV‐negative, HIV‐affected adults and families; nor have any studies in this context yet examined stigma as an ecological construct predicting mental health outcomes through supra‐individual (setting level) and individual levels of influence. Multilevel modeling was used to examine multilevel, ecological relationships between HAR stigma and mental health among child and caregiver pairs from a systematic, community‐representative sample of 508 HIV‐affected households nested within 24 communities in KwaZulu‐Natal, South Africa. Two distinct dimensions of HAR stigma were measured: individual stigmatizing attitudes, and perceptions of community normative stigma. Findings suggest that individual‐level HAR stigma significantly predicts individual mental health (depression and anxiety) among HIV‐affected adults; and that community‐level HAR stigma significantly predicts both individual‐level mental health outcomes (anxiety) among HIV‐affected adults, and mental health outcomes (PTSD and externalizing behavior scores) among HIV‐affected children. Differentiated patterns of relationships were found using the two different stigma measures. These findings of unique relationships identified when utilizing two conceptually distinct stigma measures, at two levels of analysis (individual and community) suggest that HAR stigma in this context should be conceptualized as a multilevel, multidimensional construct. These findings have important implications both for mental health interventions and for interventions to reduce HAR stigma in this context. Highlights: First to test if HIV‐related stigma predicts mental health among HIV‐affected (HIV‐) adults/childrenFirst to test whether supra‐individual (setting‐level) stigma predicts mental health in South AfricaFinds that community‐level HIV‐related stigma predicts individual‐level mental health outcomesFinds different pattern relationships using two measures capturing distinct dimensions of HIV stigmaFindings suggest HIV stigma should be conceptualized as a multilevel, multidimensional construct. [ABSTRACT FROM AUTHOR]