Objective To report on the 3-year course and outcome of mental illness and social aspects in a representative sample of 265 homeless men living on the street or using overnight shelter. Method Expert interviews at baseline and at follow-up included the SCID-I and covered cognitive impairment, somatic complaints, use of medical services and psychosocial areas. Of 247 homeless men still alive, at 3-year follow-up, 185 (74.9%) were successfully traced and interviewed face to face. Results There was considerable improvement regarding the housing situation after 3 years. Rates of mental illness decreased from 79% to 66% over 3 years possibly due to an improved housing situation and increased medical/psychiatric attention and service. The prevalence of mood disorders, substance use disorders and anxiety disorders was significantly lower at 3-year follow-up while psychotic disorders showed a slight increase over time. Thus, in general, more remission than incidence was observed in the 3-year follow-up period. A high rate of use of general medical inpatient services was found. Considering the very high prevalence of mental illness, the use of psychiatric services was very low with some increase over time. Mental health status at 1(st) assessment did not predict the housing situation at 3 year follow-up. Having had a substance use disorder diagnosis at 1(st) assessment was a powerful predictor of an unfavorable mental health status at 3 year follow-up. Standardized mortality ratio over 3 years was 4.4.