The aim of this study was to describe regional differences in the incidence of disability pensions (DPs) with psychiatric diagnoses, and to determine whether these differences were related to age and/or gender. We compared the incidence rates of new DPs including all diagnoses, with DP with psychiatric diagnoses in Norwegian regions from 1988 to 2000. The population at risk was all individuals aged 16-67 in each year. Individuals already on DP were excluded. Cases were collected from the Norwegian National Insurance Administration. The results showed that the incidence rate ratio (IRR; Norway reference) for DP with psychiatric diagnoses was most elevated for men 1.41 (95% CI 1.27-1.58) and women 1.48 (95% CI 1.34-1.64) living in the most rural region. Men in the urban area had a higher IRR, 1.33 (95% CI 1.26-1.40), than urban women, 1.02 (95% CI 0.96-1.07). The incidence more than doubled in the youngest age group (16-29 years) and decreased in the oldest age group (60-67 years) between 1988 and 2000. The findings conclude that individuals living in semi-rural regions of Norway are more likely to receive a DP with a psychiatric diagnosis than those living in urban areas. Large gender differences were found in the urban area. Further research is needed to investigate the impact of the psychiatric healthcare system and access to rehabilitation on psychiatric disability.