A label’s entrenchment, its degree of use by members of a community, affects its perceived explanatory value even if the label provides no substantive information (Hemmatian & Sloman, 2018). In three experiments, we show that laypersons and mental health professionals see entrenched psychiatric and non-psychiatric diagnostic labels as better explanations than non-entrenched labels even if they are circular. Using scenarios involving experts who discuss unfamiliar diagnostic categories, we show that this preference is not due to violations of conversational norms, lack of reflectiveness or attentiveness, and the characters’ familiarity or unfamiliarity with the label. In Experiment 1, whether a label provided novel symptom information or not had no impact on lay responses, while its entrenchment enhanced ratings of explanation quality. The effect persisted in Experiment 2 for causally incoherent categories and regardless of direct provision of mechanistic information. The effect of entrenchment was partly related to induced causal beliefs about the category, even when participants were informed there is no causal relation. Most participants in both experiments did not report any effect of entrenchment and the effect was present for those who did not. In Experiment 3, mental health professionals showed the effect using diagnoses that were mere shorthands for symptoms, despite a tendency to rate all explanations as unsatisfactory. The data suggest that bringing experts’ attention to the manipulation eliminates the effect. We discuss practical implications for mental health disciplines and potential ways to mitigate the impact of entrenchment.