ObjectiveTo evaluate the effectiveness of small‐group nurse‐administered cognitive behavioural therapy for insomnia (CBTI) as an early intervention of mood disorders with comorbid insomnia.MethodsA total of 200 patients with first‐episode depressive or bipolar disorders and comorbid insomnia were randomized in a ratio of 1:1 to receiving 4‐session CBTI or not in a routine psychiatric care setting. Primary outcome was Insomnia Severity Index. Secondary outcomes included response and remission status; daytime symptomatology and quality of life; medication burden; sleep‐related cognitions and behaviours; and the credibility, satisfaction, adherence and adverse events of CBTI. Assessments were conducted at baseline, 3, 6, and 12‐month.ResultsOnly a significant time‐effect but no group‐by‐time interaction was found in the primary outcome. Several secondary outcomes had significantly greater improvements in CBTI group, including higher depression remission at 12‐month (59.7% vs. 37.9%, χ2 = 6.57, p = .01), lower anxiolytic use at 3‐month (18.1% vs. 33.3%, χ2 = 4.72, p = .03) and 12‐month (12.5% vs. 25.8%, χ2 = 3.26, p = .047), and lesser sleep‐related dysfunctional cognitions at 3 and 6‐month (mixed‐effects model, F = 5.12, p = .001 and .03, respectively). Depression remission rate was 28.6%, 40.3%, and 59.7% at 3, 6, and 12‐month, respectively in CBTI group and 28.4%, 31.1%, and 37.9%, respectively in no CBTI group.ConclusionCBTI may be a useful early intervention to enhance depression remission and reduce medication burden in patients with first‐episode depressive disorder and comorbid insomnia.