New Zealand’s early response to the novel coronavirus pandemic included a strict lockdown which eliminated community transmission of COVID-19. However, this success was not without cost, both economic and social. In our study, we examined the psychological wellbeing of New Zealanders during the COVID-19 lockdown when restrictions reduced social contact, limited recreation opportunities, and resulted in job losses and financial insecurity. We conducted an online panel survey of a demographically representative sample of 2010 adult New Zealanders in April 2020. The survey contained three standardised measures–the Kessler Psychological Distress Scale (K10), the GAD-7, and the Well-Being Index (WHO-5)–as well as questions designed specifically to measure family violence, suicidal ideation, and alcohol consumption. It also included items assessing positive aspects of the lockdown. Thirty percent of respondents reported moderate to severe psychological distress (K10), 16% moderate to high levels of anxiety, and 39% low wellbeing; well above baseline measures. Poorer outcomes were seen among young people and those who had lost jobs or had less work, those with poor health status, and who had past diagnoses of mental illness. Suicidal ideation was reported by 6%, with 2% reporting making plans for suicide and 2% reporting suicide attempts. Suicidality was highest in those aged 18–34. Just under 10% of participants had directly experienced some form of family harm over the lockdown period. However, not all consequences of the lockdown were negative, with 62% reporting ‘silver linings’, which included enjoying working from home, spending more time with family, and a quieter, less polluted environment. New Zealand’s lockdown successfully eliminated COVID-19 from the community, but our results show this achievement brought a significant psychological toll. Although much of the debate about lockdown measures has focused on their economic effects, our findings emphasise the need to pay equal attention to their effects on psychological wellbeing.