This case report highlights a 57-year-old female patient presenting with psychiatric symptoms such as depressive mood, social withdrawal, and apathy followed by gait disturbances and tremor, which led to the diagnosis of severe Vitamin B12 deficiency-induced encephalopathy. Despite initially displaying only psychiatric symptoms, MRI revealed cerebral leukoencephalopathy. Metabolic and auto-immune evaluation confirmed profound Vitamin B12 deficiency secondary to Biermer's disease. Treatment with Vitamin B12 replacement therapy resulted in a favorable outcome. This case underscores the importance of considering Vitamin B12 deficiency in patients with neuropsychiatric symptoms, as timely diagnosis and treatment can prevent long-term complications.