BackgroundActivity and participation are critical to health and wellbeing. Limited evidence exists on how to support people with mental illness in participating in everyday activities.AimTo investigate the effectiveness of Meaningful Activities and Recovery (MA&R), a co-led peer occupational therapy intervention focusing on activity engagement, functioning, quality of life, and personal recovery.MethodsIn a statistician blinded, multicenter RCT including 139 participants from seven community and municipal mental health services in Denmark, participants were randomly assigned to 1) MA&R and standard mental health care or 2) standard mental health care. The MA&R intervention lasted 8 months and consisted of 11 group sessions, 11 individual sessions, and support to engage in activities. The primary outcome, activity engagement, was measured using Profile of Occupational Engagement in People with Severe Mental Illness (POES-S). Outcomes were measured at baseline and post-intervention follow-up.ResultsMeaningful Activities and Recovery was delivered with high fidelity and 83% completed the intervention. It did not demonstrate superiority to standard mental health care, as intention-to treat analysis revealed no significant differences between the groups in activity engagement or any of the secondary outcomes.ConclusionWe did not find positive effects of MA&R, possibly because of COVID-19 and related restrictions. Fidelity assessments and adherence rates suggest that MA&R is feasible and acceptable. However, future studies should focus on refining the intervention before investigating its effectiveness.Trial registrationThe trial was registered 24/05/2019 at ClinicalTrials.gov NCT03963245.Supplementary InformationThe online version contains supplementary material available at 10.1186/s12888-023-04875-w.