The use of medicinal plants mixed with yerba mate (Ilex paraguariensis) has been poorly studied in the ethnopharmacological literature so far. The Paraguayan Mestizo people have the longest tradition of using the yerba mate beverage, apart from the indigenous Guarani people. This study analyses the role of yerba mate and medicinal plants in the treatment of illnesses within Paraguayan folk medicine. The research was conducted among 100 Paraguayan migrants living in Misiones, Argentina, in 2014 and 2015. Yerba mate is not considered to be a medicinal plant by its own virtues but is culturally a very important type of medicinal plant intake. Ninety-seven species are employed in hot and cold versions of the yerba mate beverage. The most important species are as follows: Allophylus edulis (highest number of citations), Aristolochia triangularis (highest relative importance value), and Achyrocline flaccida and Achyrocline tomentosa (highest score by Index of Agreement on Species). The plants are used in the treatment of 18 medicinal categories, which include illnesses traditionally treated with plants: digestive system, humoral medicine, and relatively new health conditions such as diabetes, hypertension, and high levels of cholesterol. Newly incorporated medicinal plants, such as Moringa oleifera, are ingested predominantly or exclusively with the mate beverage.