BACKGROUND: Despite attempts to improve universal health coverage (UHC) in low income countries like Nepal, most healthcare utilization is still financed by out-of-pocket (OOP) payments, with detrimental effects on the poorest and most in need. Evidence from high income countries shows that depression is associated with increased healthcare utilization, which may lead to increased OOP expenditures, placing greater stress on families. To inform policies for integrating mental healthcare into UHC in LMIC, we must understand healthcare utilization and OOP expenditure patterns in people with depression. We examined associations between symptoms of depression and frequency and type of healthcare utilization and OOP expenditure among adults in Chitwan District, Nepal. METHODS: We analysed data from a population-based survey of 2040 adults in 2013, who completed the PHQ-9 screening tool for depression and answered questions about healthcare utilization. We examined associations between increasing PHQ-9 score and healthcare utilization frequency and OOP expenditure using negative binomial regression. We also compared utilization of specific outpatient service providers and their related costs among adults with and without probable depression, determined by a PHQ-9 score of 10 or more. RESULTS: We classified 80 (3.6%) participants with probable depression, 70.9% of whom used some form of healthcare in the past year compared to 43.9% of people without probable depression. Mean annual OOP healthcare expenditures were $118 USD in people with probable depression, compared to $110 USD in people without. With each unit increase in PHQ-9 score, there was a 14% increase in total healthcare visits (95% CI 7-22%, p < 0.0001) and $9 USD increase in OOP expenditures (95% CI $2-$17; p < 0.0001). People with depression sought most healthcare from pharmacists (30.1%) but reported the greatest expenditure on specialist doctors ($36 USD). CONCLUSIONS: In this population-based sample from Central Nepal, we identified dose-dependent increases in healthcare utilization and OOP expenditure with increasing PHQ-9 scores. Future studies should evaluate whether provision of mental health services as an integrated component of UHC can improve overall health and reduce healthcare utilisation and expenditure, thereby alleviating financial pressures on families.