The COVID-19 pandemic accelerated the adoption of telehealth services for remote mental health care provision. Although studies indicate that telehealth can enhance the efficiency of service delivery and might be favored or even preferred by certain clients, its use varied after the pandemic. Once the pandemic-related restrictions eased, some regions curtailed their telehealth offerings, whereas others sustained them. Understanding the factors that influenced these decisions can offer valuable insights for evidence-based decision-making concerning the future of telehealth in mental health services. This study explored the factors associated with the uptake of and retreat from telehealth across a multiregional outpatient mental health service in Aotearoa New Zealand. We aimed to contribute to the understanding of the factors influencing clinicians' use of telehealth services to inform policy and practice. Applying an interpretive description methodology, this sequential mixed methods study involved semistructured interviews with 33 mental health clinicians, followed by a time-series analysis of population-level quantitative data on clinician appointment activities before and throughout the COVID-19 pandemic. The interviews were thematically analyzed, and select themes were reframed for quantitative testing. The time-series analysis was conducted using administrative data to explore the extent to which these data supported the themes. In total, 4,117,035 observations were analyzed between September 2, 2019, and August 1, 2022. The findings were then synthesized through the rereview of qualitative themes. The rise and recession of telehealth in the study regions were related to 3 overarching themes: clinician preparedness and role suitability, population determinants, and service capability. Participants spoke about the importance of familiarity and training but noted differences between specialist roles. Quantitative data further suggested differences based on the form of telehealth services offered (eg, audiovisual or telephone). In addition, differences were noted based on age, gender, and ethnicity; however, clinicians recognized that effective telehealth use enabled clinicians' flexibility and client choice. In turn, clinicians spoke about system factors such as telehealth usability and digital exclusion that underpinned the daily functionality of telehealth. For telehealth services to thrive when they are not required by circumstances such as pandemic, investment is needed in telehealth training for clinicians, digital infrastructure, and resources for mental health teams. The strength of this study lies in its use of population-level data and consideration of a telehealth service operating across a range of teams. In turn, these findings reflect the voice of a variety of mental health clinicians, including teams operating from within specific cultural perspectives.