I find that lots of students come to yoga class seeking alleviation for mental health issues: most commonly, anxiety, depression, & insomnia. This is not surprising considering depression and anxiety effects roughly 1 in 5 adults. I too have struggled in the past, and now use yoga as a daily tool to maintain physical and mental health. While the research is not entirely conclusive, there is a lot to suggest that yoga and mental health are in fact connected.
A study published in the Indian Journal of Physiology and Pharmacology (Vol. 48, No. 3), shows that “yoga targets unmanaged stress, a main component of chronic disorders such as anxiety, depression, obesity, diabetes and insomnia.”
It seems to do this by two main factors:

1. Yoga reduces the stress hormone cortisol, which, in turn, reduces the activity of our sympathetic (fight or flight) nervous system and our stress response. This can lead to less depression, less anxiety, and better sleep.

     2. Yoga improves Mind-Body Awareness. Mind-body awareness is a major component of all my classes. I frequently ask students to pause and stand in mountain pose (Sanskrit: Tadasana) and take mental notes of any new sensations in their bodies (i.e. increased heart rate, sweat on the skin, tingling in fingers, et cetera) Often we spend our entire day living in our heads and letting our thoughts dominate everything.  It’s a nice practice to take a minute to be mindful and pay attention to what is actually happening in our own bodies. What sensations are we experiencing? A pit in the stomach from anxiety? Tightness in chest from panic or dread? Lethargy from sadness?  
Often people experiencing emotional dysregulation feel physically immobilized or out of touch with their bodies (even perhaps having an “out of body” experience like you’re watching your own self). Instead of getting in a rat race within the mind of trying to analyze our feelings or solve a hundred problems at a time, mindfulness allows us to sit with the feeling or the sensation and simply take note of it without trying to change anything.
This practice alone tends to soothe ailments by telling the practitioner that he or she doesn’t have to try to “fix” everything. It allows the practitioner to create some space from the emotion or problem and later create a plan to tackle it with a clearer and more logical mind. Yoga and its propensity for mind-body awareness allows the individual to reconnect to the present moment. Most often you’ll find the present moment is not so bad.
 
Other points to note from the article in American Psychological Association:

• In a 2007 study in the Journal of Alternative and Complementary Medicine (Vol. 13, No. 4), researchers at Boston University found that an hour of yoga increased the anxiety-reducing neurotransmitter GABA by 27% while reading a book for an hour had no effect on GABA.

 

• Psychologist David Shapiro found that students who practiced Iyengar yoga three times a week for two months reported significant reductions in depression & anxiety and reported mood improvements at the end of each class (Evidence-based Complementary and Alternative Medicine, Vol. 4, No. 4).

 

• Therapists are beginning to use yoga’s mind-body awareness and breathing techniques in their psychotherapy sessions. Examples include having clients get as comfortable as possible during their sessions (much like Savasana, final resting pose) or paying attention to how their bodies feel when they inhale and exhale, directing clients to be in the present moment, temporarily separating them from thoughts, emotions, or impulses.

 

• One therapist wrote, ”practicing yoga personally and adopting a stance based on yoga principles such as non-judgment, compassion, spirituality and the connection of all living things can help relieve stress, enhance compassion and potentially make you a better therapist". "If you can come to a level of peace with yourself, there may be more nurturing that you exude toward your patients." I would add to this list the qualities of non-attachment, non-coveting, less buying & wanting of THINGS in our materialistic market, having a sense that “THIS is enough”, and experiencing a greater connection to nature and the Earth.

 
References:
American Psychological Association
http://www.apa.org/monitor/2009/11/yoga.aspx
 
 

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