Abstract Background During the recent decade, a number of studies have begun to address Quality of Life (QoL) in children and adolescents with mental health problems in general population and clinical samples. Only about half of the studies utilized both self and parent proxy report of child QoL. Generally children with mental health problems have reported lower QoL compared to healthy children. The question whether QoL assessment by both self and parent proxy report can identify psychiatric health services needs not detected by an established instrument for assessing mental health problems, i.e. the Child Behavior Checklist (CBCL), has never been examined and was the purpose of the present study. Methods No study exists that compares child QoL as rated by both child and parent, in a sample of referred child psychiatric outpatients with a representative sample of students attending public school in the same catchment area while controlling for mental health problems in the child. In the current study patients and students, aged 8-15.5 years, were matched with respect to age, gender and levels of the CBCL Total Problems scores. QoL was assessed by the self- and parent proxy-reports on the Inventory of Life Quality in Children and Adolescents (ILC). QoL scores were analyzed by non-parametric tests, using Wilcoxon paired rank comparisons. Results Both outpatients and their parents reported significantly lower child QoL on the ILC than did students and their parents, when children were matched on sex and age. Given equal levels of emotional and behavioural problems, as reported by the parents on the CBCL, in the two contrasting samples, the outpatients and their parents still reported lower QoL levels than did the students and their parents. Conclusions Child QoL reported both by child and parent was reduced in outpatients compared to students with equal levels of mental health problems as reported by their parents on the CBCL. This suggests that it should be helpful to add assessment of QoL to achieve a fuller picture of children presenting to mental health services.