Depression carries serious psychosocial, physical, and economic consequences for cancer survivors. Study goals were to characterize patterns and predictors of depressive symptoms and major depressive episodes in recently diagnosed breast cancer patients. Consecutively recruited women (N = 460) completed a validated interview (CIDI) and questionnaire measure (CES-D) of depression within 4 months after invasive breast cancer diagnosis and at six additional assessments across 12 months. Outcomes were major depressive episodes, continuous symptom scores, and latent symptom trajectory classes. Across 12 months, 16.6 % of women met criteria for a major depressive episode. Unemployment predicted depressive episodes after other correlates were controlled. Distinct trajectory classes were apparent: an estimated 38 % of women had chronically elevated symptoms (High trajectory), 20 % recovered from elevated symptoms (Recovery), and 43 % had lower symptoms (Low and Very Low trajectories). Although 96 % of episodes occurred in the High or Recovery classes, 66 % of women in the High trajectory did not have an episode. Women in the Low (vs High) trajectory were more likely to be older, retired, more affluent, and have fewer comorbid diseases and briefer oncologic treatment. Women in the Recovery trajectory (vs High) were more likely to be married and more affluent and have fewer comorbid diseases. Assuming available therapeutic resources, assessment of both depressive symptoms and episodes over several months after diagnosis is important. Identification of patients at risk for persistently high depressive symptoms (e.g., younger, longer treatment course) opens targeted opportunities to prevent and promote rapid recovery from depression.