<p>Being diagnosed with a chronic illness is a life-altering experience that can be shaped, for better or worse, by psychological factors. How patients think about their illness—their core beliefs about what it means and what it might bring such as whether it is catastrophic, manageable, or even an opportunity—can influence how they respond and adapt. This research introduces the concept of illness mindsets and presents the initial validation of the Illness Mindset Inventory (IMI), a new tool designed to assess these beliefs and their implications for health and well-being. Study 1 examines the factor structure, internal reliability, and discriminant validity of the 9-item IMI in N = 201 healthy participants and N = 200 participants with cancer, diabetes, cardiovascular disease, and/or chronic pain. Study 2 investigates cancer patients (N = 463) with different degrees of illness severity and tests the pre-registered hypothesis that the IMI will account for variability in functioning over and above measures of illness severity. In Study 1, illness mindsets were associated with between 5.7 and 12.1% additional variance in physical, social, and emotional functioning, above and beyond disease status. In Study 2, illness mindsets accounted for between 6.9 and 12.0% additional variance in physical functioning, social functioning, and emotional distress in people diagnosed with cancer above and beyond cancer stage, cancer status, trait optimism, and self-efficacy. Illness mindsets may help account for variance in individual functioning beyond disease status and disease severity. Future research can probe the IMI’s utility in supporting patient care; in predicting functioning before, during, and after a diagnosis; and as a potential target for intervention.</p>