Background: Psychiatric medications play a vital role in the management of mental health disorders. However, the COVID-19 pandemic and subsequent lockdown limited access to primary care services, leading to an increase in remote assessment and treatment options to maintain social distancing. This study aimed to investigate the impact of the COVID-19 pandemic lockdown on the use of psychiatric medication in primary care settings. Methods: We conducted a retrospective claims-based analysis of anonymized monthly aggregate practice-level data on anxiolytics and hypnotics use from 322 general practitioner (GP) practices in the North East of England, where health disparities are known to be higher. Participants were all residents who took anxiolytics and hypnotics from primary care facilities for two financial years, from 2019/20 to 2020/21. The primary outcome was the volume of Anxiolytics and Hypnotics used as the standardized, average daily quantities (ADQs) per 1000 patients. Based on the OpenPrescribing database, a random-effect model was applied to quantify the change in the level and trend of anxiolytics and hypnotics use after the UK national lockdown in March 2020. Practice characteristics extracted from the Fingertips data were assessed for their association with a reduction in medication use following the lockdown. Results: This study in the North East of England found that GP practices in higher health disparate regions had a lower workload than those in less health disparate areas, potentially due to disparities in healthcare utilization and socioeconomic status. Patients in the region reported higher levels of satisfaction with healthcare services compared to the England average, but there were differences between patients living in higher versus less health disparate areas. The study highlights the need for targeted interventions to address health disparities, particularly in higher health disparate areas. The study also found that psychiatric medication use was significantly more common in residents living in higher health disparate areas. Daily anxiolytics and hypnotics use decreased by 14 items per 1000 patients between the financial years 2019/20 and 2020/21. A further nine items per 1000 decreased for higher health disparate areas during the UK national lockdown. Conclusions: People during the COVID-19 lockdown were associated with an increased risk of unmet psychiatric medication demand, especially for higher health disparate areas that had low-socioeconomic status.