Is an adjustment disorder with depressed mood considered a medical disability?

Not necessairily.: A diagnosis by itself is not considered disabling. It depends upon what the diagnosis is causing in the persons life that determines whether it is disabling or not.

Not likely: I agree with my colleague that "disablity" depends on what the condition does in the person's life. Adjustment disorders come in response to a stressor, and usually last no longer than 6 months (unless a very chronic, ongoing stressor). With help, the person is usually able to deal with the stressor so that it no longer dominates life -- and life can move on, along with fruitful occupation.