The swift advancement of artificial intelligence (AI) systems has revolutionized multiple fields, including mental health care. Digital interventions powered by AI are now being utilized to oversee and address psychological issues such as anxiety, depression and mood disorders. Nevertheless, these innovations frequently outstrip ethical considerations, especially in relation to the intricacies of human psychology and the dangers associated with algorithm-driven therapeutic approaches. This chapter offers a critical analysis of the ethical challenges linked to the application of AI in mental health, particularly addressing the assumption that human mental health can be explained through algorithms and the difficulties in guaranteeing authentic consent in AI-facilitated therapy. By conducting a qualitative review of existing literature and an analytical assessment of current AI mental health solutions, the research underscores the ethical concerns tied to autonomy, privacy, and the psychological limitations of these technologies. The results highlight the necessity for a careful approach and suggest factors for the ethical development of future AI systems in the realm of mental health.