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Abstract Background Children in out-of-home care are consistently found to have poor mental health compared to children in the general population. However, UK research has so far failed to disentangle the impact of the care system on children's mental health outcomes from the effects of the adverse circumstances that led to their admission to care. Objective This research investigated the association between care placement and the presence of child mental health problems after controlling for children's pre-care experiences. It also identified factors associated with mental health problems among children in care. Participants and Setting The sample comprised three groups of children involved with child welfare services due to maltreatment, including children in out-of-home care (n = 122), reunified children (n = 82) and those who had never been in care (n = 159). Methods The mental health of the children in the three groups was compared, using information collected from their parents/foster carers and social workers. Results The odds of a child in out-of-home care having a mental health problem were not significantly higher than those of a child who had never been in care (AOR = 1.24; p = 0.462). However, the odds of a child in out-of-home care having reactive attachment disorder (RAD) were significantly higher than those of a child who had never been in care (AOR=1.92; p = 0.032). Conclusions These findings make an important contribution to international debates about whether placing children in care is beneficial or detrimental to their wellbeing, and highlight a range of inter-linking factors associated with the mental health of children in out-of-home care. [ABSTRACT FROM AUTHOR]