Objective The current study aimed to examine the neural correlates of processing genuine compared with posed emotional expressions, in depressed and healthy subjects using a novel functional magnetic resonance imaging (fMRI) paradigm Method During fMRI scanning, sixteen depressed patients and ten healthy controls performed an Emotion Categorisation Task, whereby participants were asked to distinguish between genuine and non-genuine (posed or neutral) facial displays of happiness and sadness. Results Compared to controls, the depressed group showed greater activation whilst processing genuine versus posed facial displays of sadness, in the left medial orbitofrontal cortex, caudate and putamen. The depressed group also showed greater activation whilst processing genuine facial displays of sadness relative to neutral displays, in the bilateral medial frontal/orbitofrontal cortex, left dorsolateral prefrontal cortex, right dorsal anterior cingulate, bilateral posterior cingulate, right superior parietal lobe, left lingual gyrus and cuneus. No differences were found between the two groups for happy facial displays. Limitations Relatively small sample sizes and due to the exploratory nature of the study, no correction was made for multiple comparisons. Conclusion The findings of this exploratory study suggest that depressed individuals may show a different pattern of brain activation in response to genuine versus posed facial displays of sadness, compared to healthy individuals. This may have important implications for future studies that wish to examine the neural correlates of facial emotion processing in depression.