Clinical care for bipolar disorder (BD) has a narrow focus on prevention and remission of episodes with pre/post treatment reductions in symptom severity as the 'gold standard' for outcomes in clinical trials and measurement-based care strategies. The study aim was to provide a innovative method for measuring outcomes in BD that has clinical utility and can stratify individuals with BD based on mood instability. Participants were 603 with a BD (n=385), other or non-affective disorder (n=71), or no psychiatric history (n=147) enrolled in an longitudinal cohort for at least 10 years that collects patient reported outcomes measures (PROMs) assessing depression, (hypo)mania, anxiety, and functioning every two months. Mood instability was calculated as the intraindividual standard deviation (s.d.) of PROMs over one-year rolling windows and stratified into low, moderate, and high thresholds, respectively. Individuals with BD had significantly higher one-year rolling SDs for depression, (hypo)mania, and anxiety compared to psychiatric comparisons (small - moderate effects) and healthy controls (large effects). A significantly greater proportion of scores for those with BD fell into the moderate (depression: 50.6%; anxiety: 36.5%; (hypo)mania: 52.1%) and high thresholds (depression: 9.4%; anxiety: 6·1%; (hypo)mania: 10·1%) compared to psychiatric comparisons (moderate: 32.3 - 42·9%; high: 2.6% - 6·6%) and healthy controls (moderate: 11.5% - 31.7%; high: 0.4% - 5.8%). Being in the high or moderate threshold predicted worse mental health functioning (small to large effects). Mood instability, as measured in commonly used PROMs, characterized the course of illness over time, correlated with functional outcomes, and significantly differentiated those with BD from healthy controls and psychiatric comparisons. Results suggest a paradigm shift in monitoring outcomes in BD, by measuring intraindividual SDs as a primary outcome index.