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Background Sharing patient data can help drive scientific advances and improve patient care, but service users are concerned about how their data are used. When the National Health Service proposes to scrape general practitioner records, it is very important that we understand these concerns in some depth. Objective This study aims to investigate views of mental health service users on acceptable data sharing to provide clear recommendations for future data sharing systems. Methods A total of 4 focus groups with 4 member-checking groups were conducted via the internet between October 2020 and March 2021, with a total of 22 service users in the United Kingdom. Thematic analysis was used to identify the themes. Results Six main themes, with several subthemes were identified, such as the purpose of data sharing—for profit, public good, and continuation of care; discrimination through the misattribution of physical symptoms to mental health conditions (ie, diagnostic overshadowing) alongside the discrimination of individuals or groups within society (ie, institutional discrimination); safeguarding data by preserving anonymity and confidentiality, strengthening security measures, and holding organizations accountable; data accuracy and informed consent—increasing transparency about data use and choice; and incorporating service user involvement in system governance to provide insight and increase security. Conclusions This study extends the limited research on the views and concerns of mental health service users regarding acceptable data sharing. If adopted, the recommendations should improve the confidence of service users in sharing their data. The five recommendations include screening to ensure that data sharing benefits the public, providing service users with information about how their data are shared and what for, highlighting the existing safeguarding procedures, incorporating service user involvement, and developing tailored training for health care professionals to address issues of diagnostic overshadowing and inaccurate health records. Adopting such systems would aid in data sharing for legitimate interests that will benefit patients and the National Health Service.