Acquired hand trauma is a significant event that often affects an individuals’ life in diverse manners. The present paper aims to review the psychological issues in hand trauma along with factors that affect recovery from the same. Method: A relevant search for literature on psychological issues in hand trauma was made across search engines like Google Scholar, Medline and Pubmed and relevant studies were selected for this review. The studies include those on symptomatology, course as well as treatment. The studies were analyzed critically along with inputs of personal clinical experience of the authors. Results: Psychological symptoms that occur after hand trauma together with the treatment methods that provide relief from psychological symptoms are discussed. Symptoms of post-traumatic stress disorder (PTSD), flashbacks, concerns with personal appearance, avoidance of reminders of the trauma and physiological arousal along with sleep issues have been discussed. The article also looks at the psychosocial effects of hand trauma including marital and sexual issues that may arise. Treatment interventions commonly used in the form of imagery and in vivo exposure with and without cognitive restructuring are explained along with psychoeducation approaches that may benefit these patients. Conclusions: It is important that surgeons and professionals dealing with hand trauma are aware of the psychological issues in hand trauma and to take appropriate steps to deal with any such problems that ensue.