Objective: To describe the establishment of Australia’s first psychiatric day hospital in Western Australia in April 1959 by Dr Digby Moynagh (1911–1963). Methods: A range of primary and secondary sources were consulted. Results: Moynagh was able to establish the Graylands Day Hospital because he had an outsider’s perspective, and was familiar with the day hospital model from UK psychiatric literature. However, he was opposed by local medical and political interests, which eventually led to his departure from the State. Conclusions: The Graylands Day Hospital and Digby Moynagh both contributed towards the process of psychiatric deinstitutionalisation in Australia.