Background Previous research has shown that lymphoedema impacts negatively on an individual, including psychological distress and body image disturbance, particularly for younger women. This study identified psychological factors associated with distress in women with breast cancer‐related lymphoedema and determined whether age moderated the specific relationship between body image disturbance and distress. Methods Australian women (n = 166) diagnosed with breast cancer‐related lymphoedema were recruited through a community‐based breast cancer organisation and lymphoedema treatment clinics. Participants completed an online survey assessing lymphoedema‐related cognitions (personal control, perceived treatment effectiveness, and consequences of lymphoedema), perceived ability to self‐regulate lymphoedema‐related negative affect, body image disturbance, psychological distress (depression, anxiety and stress), and demographic/medical information. Results Beliefs about the consequences, perceived effectiveness of treatment and controllability of lymphoedema, perceived ability to self‐regulate negative affect, body image disturbance, and number of lymphoedema symptoms were correlated with depression, anxiety, and stress scores. Multivariate regression analyses indicated that body image disturbance was significantly associated with depression, anxiety, and stress, and perceived treatment effectiveness was associated with stress. Age was a significant moderator of the relationship between body image disturbance and depression and anxiety, with older women with greater body image disturbance more distressed. Conclusions Health professionals need to be aware that women diagnosed with lymphoedema are at risk of experiencing psychological distress, particularly arising from body image disturbance and beliefs that treatment cannot control lymphoedema. Furthermore, older women may be at an increased risk of anxiety and depression arising from body image disturbance. Copyright © 2015 John Wiley & Sons, Ltd. Copyright © 2015 John Wiley & Sons, Ltd.