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We assessed the association of employee lifestyles (e.g., smoking, exercise, drinking, and sleep habits) with mental health-related absenteeism and turnover rates utilizing data from the annual Health and Productivity Management survey by Japan's Ministry of Economy, Trade and Industry. This analysis included data from 1,748 companies, encompassing 4,199,021 employees. The average proportions of mental health-related absenteeism and employee turnover rates were 1.1% (±1.0%) and 5.0% (±5.0%), respectively. In multivariable regression models that incorporated all lifestyle factors and confounders, a 1 percentage point increase in the proportion of employees who slept well was associated with reductions in their turnover rate (mean -0.020%; 95% CI, -0.038% to -0.002%) and in mental health-related absenteeism (mean -0.005%; 95% CI, -0.009% -0.001%). A similar increase in the proportion of employees engaging in regular physical activity corresponded with a 0.005% decrease in the prevalence of mental health-related absenteeism (95% CI, -0.010% to -0.001%). A 1 percentage point increase in the proportion of employees who smoked was associated with a 0.013% reduction in mental health-related absenteeism (95% CI, -0.017% to -0.008%). Nonetheless, the current study's observational and cross-sectional design restricted the ability to establish causality between employee lifestyle factors and mental health issues.