What happened when Picard was assimilated?

In the TNG two-parter "The Best of Both Worlds," Picard was captured by the Borg and transformed into Locutus of Borg — an interface between the Collective and humanity, using his knowledge and voice to lead the Borg invasion of Federation space. The Battle of Wolf 359, in which 39 Starfleet vessels and 11,000 people died, was directed through him.

He was restored after the crew found a way to use his lingering connection to the Collective against it. But he was not unaffected.

What was the psychological aftermath?

Shown most directly in the episode "Family," which followed immediately. He returned to his brother's home in France — the first time we see him off the ship outside an adventure. He breaks down in a vineyard. He confesses that he was not able to fight them, that they violated everything he was, that he is not certain he has fully come back.

This is remarkable for 1990s television: a lead character allowed to be broken, to not be fine, to need time that the narrative actually shows.

What does his recovery teach?

That strength is not the absence of damage. Picard returned to the Enterprise. He commanded again. He did not resolve his trauma — in First Contact (1996), his obsession with the Borg nearly cost the mission, and he was called on it directly by Lily Sloane. He continued to carry and manage something that did not fully heal.

This is more honest about recovery than most narratives allow: not erasure, but continued functioning alongside damage.