Objective: The causal effect of successive population-wide lockdowns in response to increased COVID-19 cases on mental health has yet to be examined using robust methods. A natural experiment design underpinned by objective data can improve our understanding surrounding the definitive impact of social distancing restrictions. Methods: The study employed a natural experiment design underpinned by objective data. Health service cost for visits to general practitioners and psychologists and medication dispensing costs served as objective measures of mental health. Difference-in-difference (DID) estimators, which in this study quantify differences in spending changes between groups over time, were produced based on three comparisons: Victoria 2020 lockdown comparison, Victoria 2021 lockdown comparison, and New South Wales (NSW) 2021 lockdown comparison. Specifically, differences in public health service spending during lockdown periods and the same timeframe in 2019 for Victoria and NSW, and control groups (remaining states and territories), were compared. Results: Positive estimator values indicate that public health service spending for Victoria and NSW increased more during lockdown periods compared to control states and territories. The Victorian lockdowns of 2020 and 2021, but not the NSW lockdown of 2021, resulted in increased public spending for general practitioner mental health consults (2020 DID estimator: $8498.96 [95% CI $4012.84, $12,373.57], 2021 DID estimator: $6630.06 [95% CI $41.27, $13,267.20], all monetary values in AUD$) and short visits to psychologists (2020 DID estimator: $628.82 [95% CI $466.25, $796.00], 2021 DID estimator: $230.11 [95% CI $47.52, $373.98]). The first Victorian lockdown in 2020 and the NSW lockdown in 2021 resulted in greater spending on short visits to clinical psychologists. Spending on long visits to psychologists and clinical psychologists and medication spending did not change. Conclusions: Strict lockdowns can have an adverse impact on population mental health. The impact is particularly evident in those who have a history of previous mental health concerns but does not necessitate extra use of medications, suggesting that psychological care can address the adverse impact of the lockdowns. What is known about the topic? Previous research varied in methodology, using self-reports and healthcare data to understand COVID-19 social distancing public health measures' effects on mental health. What does this paper add? This study introduces robust, objective data via a natural experiment design, examining the impact of successive lockdowns on mental health service usage and medication expenditures in specific Australian regions. What are the implications for practitioners? Findings highlight the need for flexible mental health services that can swiftly respond to increased demands during prolonged restrictions, without necessarily increasing medication use, guiding future policy and resource allocation. [ABSTRACT FROM AUTHOR]