It has been widely proven that resettlement is associated with negative psychological effects (e.g., increased depression and symptoms of post-traumatic stress disorder) among refugees. Therefore, there is an urgent need to improve the psychosocial functioning of migrants. This study assessed associations between negative dysfunctional appraisal (perceiving experiences as stressful), spiritual needs, religious coping and wellbeing. Data from paper-and-pencil questionnaires were collected from 744 refugees (69.8% male) aged 18–67 years (M = 27.99) with diverse backgrounds (including from Mashreq countries) who were resettled in Germany. Bootstrapping mediation analysis revealed that the relationship of dysfunctional appraisal and wellbeing among refugees is mediated by spiritual needs (i.e., existential and religious needs). Additionally, negative religious coping mediates the relationship between spiritual needs and wellbeing. The data obtained suggest the need for practitioners to focus on psychological interventions that strengthen spiritual needs in order to improve mental health among refugees.