A total 142 Australian troops who served in Iraq and Afghanistan were discharged from the defence force for suffering mental trauma.
The number represents 28 percent of more than 500 army, navy and air force personnel medically discharged from the service since 2003, Defence statistics showed.
About 42 percent or 214 health discharge cases were related to post traumatic stress disorder and extreme anxiety.
Meanwhile, the Australian Defence Force reported 24 veterans of the Afghanistan war being discharged for mental health reasons in the first half of the year. The number of discharges in the prior six months was higher at 31.
Alarmed by the rising number of mental illness in its ranks, the ADF has embarked on a program to double the number of its mental health workers and improve mental health research and surveillance.
The ADF also plans to involve families more in the caring of affected soldier's and to institute effective management of soldiers' transition to a non-military life.
So far, a Centre for Mental Health has been established and regional mental health teams were formed to prevent suicide and abuse of drugs and alcohol among soldiers. Soldiers are apparently trying to get rid of their trauma by using drugs and alcohol.