The aging of population has become gradually deepening in today’s China. The aged care services system should focus on the disabled elders. however, the past study has not yet been explored in depth about the elder’s depression caused by disability. First, the study aims to estimate the impact between the disability to the depression by the Instrumental Activity of Daily Living based on CFPS2018 survey data and analyze its heterogeneity effect. Secondly, the study employs the mediation analysis by the mediator of personality traits and cognitive ability. Thirdly, the study analyzes the moderating effect between disability to elder’s depression by the social support and social participation. After the robustness test, there is a negative correlation between IADL to elder’s depression. In addition, particular personality traits and mathematical reasoning ability show significant moderating effect. The regional factors and demographic factors show significant heterogeneity. To improve the assessment and monitoring system about elder’s disability and cognition, and to set up the early warning mechanism of mental health in focus groups of particular personality traits and cognition, and to improve the mental health medical service in basic level public health system. Long-term care insurance plays an important role in mental health of disabled elder to base on the system level, and the government promote vigorously intelligent aged care services system in order to boost society participation sense.