Women living with HIV (WLHIV) are vulnerable to various mental health challenges. However, there is a paucity of studies globally and in the Indonesian context that have specifically explored mental health challenges among mothers living with HIV who also have children living with HIV (CLHIV). This qualitative study explored mental health challenges and the associated factors in mothers living with HIV who have CLHIV in Yogyakarta, Indonesia. In-depth interviews were employed to collect data from the participants (n = 23) who were recruited using the snowball sampling technique. A qualitative data analysis framework was used to guide the analysis of the findings. The findings showed that the mothers experienced a range of mental health issues due to their own, and their child’s diagnoses of stress, depression, anxiety, fear, sadness, and guilt. Lack of knowledge about HIV, fear of death, shame, not knowing whom to talk with and what to do after their own HIV diagnosis, and the HIV diagnosis of their children were factors that challenged their mental health. Difficulties in dealing with daily life or social activities of their CLHIV, dilemmas in addressing questions and complaints of their CLHIV about HIV treatment, and concerns about the health condition of their CLHIV and how their children cope with any potential negative social impacts also impacted the mothers’ mental health. Social factors such as unsympathetic expressions from friends towards them and their CLHIV and negatively worded religious-related advice from parents and relatives also contributed to their poor mental health. Our findings indicate the need for intervention programs that support mothers living with HIV and their CLHIV. Future large-scale studies involving mothers living with HIV who have CLHIV in Indonesia and other settings globally are needed to obtain a comprehensive understanding of mental health challenges and the associated factors they face.