The aim of this study was to compare peloid therapy in addition to home exercise with home exercise alone in terms of pain, function, quality of life, and depression in patients with chronic low back pain (cLBP). A total of 106 cLBP patients were divided into two equal groups as treatment and control. The peloid therapy group had peloid therapy (with a total of 15 sessions on 5 days per week for 3 weeks duration with 45 °C temperature lasting 30 min/day) + home exercise program. The control group was only given a home exercise program. Patients completed the visual analog scale-pain (VAS-pain), patient and physician global assessments (VAS-PGA and VAS-PhGA), revised Oswestry disability index (rODI) for functional status, the short form-36 (SF-36) for quality of life, and Beck Depression Inventory (BDI) for depression three times as before treatment, after treatment (3rd week), and 1 month after the end of treatment. Assessments in the 3rd week at the end of treatment revealed statistically significant improvements for rODI (p = 0.013), VAS-pain (p = 0.039), and VAS-PhGA (p = 0.002) parameters in the peloid therapy group compared to the control group. Assessments in the 1st month after the end of treatment revealed statistically significant improvements in rODI (p < 0.001), VAS-pain (p < 0.001), VAS-PGA (p = 0.002), VAS-PhGA (p < 0.001), and SF-36VE (p = 0.022) parameters in the peloid therapy group compared to the control group. Peloid therapy + home exercise was statistically significantly superior to home exercise alone in improving pain and function in patients with cLBP. Peloid therapy may be recommended as a non-pharmacological treatment for cLBP patients. There is a need for randomized studies with longer follow-up including biochemical parameters to verify the beneficial effects observed in this study and elaborate the mechanisms of action.