Background: Health care workers exposed to COVID-19 might be at risk of developing mental health problems. The study aimed to identify factors associated with anxiety, depression and insomnia among health workers involved in COVID-19 response in Nepal. Methods: This was a cross-sectional web-based survey conducted in between April 26 to May 12, 2020. A total of 475 health workers participated in the study. Anxiety and depression were measured using 14-item Hospital Anxiety and Depression Scale (HADS: 0- 21) and insomnia was measured by using 7-item Insomnia Severity Index (ISI: 0-28). Multivariable logistic regression analysis was done to determine the risk factors of mental health outcomes. Results: Overall, 41.9% of health workers had symptoms of anxiety, 37.5% had depression symptoms and 33.9% had symptoms of insomnia. Stigma faced by health workers was significantly associated with higher odds of experiencing symptoms of anxiety (AOR: 2.47; 95% CI: 1.62-3.76), depression (AOR: 2.05; 95% CI: 1.34-3.11) and insomnia (AOR: 2.37; 95% CI: 1.46-3.84). History of medication for mental health problems was significantly associated with higher likelihood of experiencing symptoms of anxiety (AOR: 3.40; 95% CI:1.31-8.81) , depression (AOR: 3.83; 95% CI: 1.45-10.14) and insomnia (AOR: 3.82; 95% CI: 1.52-9.62) while inadequate precautionary measures in the workplace was significantly associated with higher odds of exhibiting symptoms of anxiety (AOR: 1.89; 95% CI: 1.12-3.19) and depression (AOR: 1.97; 95% CI: 1.16-3.37). Nurses (AOR: 2.33; 95% CI: 1.21-4.47) were significantly more likely to experience anxiety symptoms than other health workers. Conclusion: The study findings revealed higher proportion of anxiety, depression and insomnia among health workers during the early phase of the pandemic in Nepal. Health workers facing stigma, those with history of medication for mental health problem, and those reporting to having inadequate precautionary measures in their workplace were more at risk of developing mental health outcomes. A focus on improving mental health wellbeing of health workers should be immediately initiated with attention to reduction of stigma, ensuring adequate support system such as personal protective equipments, and family support for those with history of mental health problems.