Assessment in mental health research has evolved from focusing on symptoms and diagnosis to addressing a broad range of change, including psychosocial functioning. This is consistent with developments in the areas of psychosocial rehabilitation and the increase in recovery-oriented intervention models for mental disorders. We reviewed the status of assessment in mental health research, providing an overview of symptom and diagnostic assessment that is the cornerstone of most mental health research assessment. We then focused on measurement that can be applied across diagnostic groups and on functioning as a key mental health outcome. We reviewed the International Classification of Functioning, Disability, and Health and its implications for improvements in assessment. We provided an example of a new assessment, the Inventory of Psychosocial Functioning, which highlights key issues in the measurement of functioning. We then addressed improving research assessment, including issues of assessment in diverse populations and the need to capitalize on new data sources and new assessment technologies to advance assessment in mental health research. Finally, we reviewed and discussed areas for research and quality improvement, drawing on examples from the Department of Veterans Affairs to illustrate potential opportunities.