The aim of this study is to examine the mental health problems of older adults living in a residential home in a Greek rural area. A sample of 40 residents was compared with 40 matched controls attending a community open care centre for the elderly (OCCE). The following measures were used: Mini International Neuropsychiatric Interview (MINI), Geriatric Depression Screening Scale (GDSS), and the Mini Mental State Examination (MMSE). The group of the residents had a lower educational level and presented with a higher prevalence of depression and suicidality. Suicidal ideation was not significantly correlated to any of the examined independent social or psychological factors and was persistent during a period of two years follow-up. It is possible that, especially in rural areas, admission in the institution is per se a traumatic event precipitating suicidality. The issues of effective psychological care for older adults in residential care are discussed.