Cell adhesion molecule proteins play a diverse role in neural development, signal transduction, structural linkages to extracellular and intracellular proteins, synaptic stabilization, neurogenesis, and learning. Three basic mRNA isoforms and potent posttranslational modifications differentially regulate these neurobiological properties of the neural cell adhesion molecule (N-CAM). Abnormal concentrations of N-CAM 105-115 kDa (cN-CAM), N-CAM variable alternative spliced exon (VASE), and N-CAM secreted exon (SEC) are related to schizophrenia and bipolar neuropsychiatric disorders. These N-CAM isoforms provide potential mechanisms for expression of multiple neurobiological alterations between controls and individuals with schizophrenia or bipolar illness. Multiple processes can trigger the dysregulation of N-CAM isoforms. Differences in neuropil volume, neuronal diameter, gray matter thickness, and ventricular size can be related to N-CAM neurobiological properties in neuropsychiatric disorders. Potential test of the N-CAM dysregulation hypothesis of neuropsychiatric disorder is whether ongoing dysregulation of N-CAM would cause cognitive impairments, increased lateral ventricle volume, and decreased hippocampal volume observed in schizophrenia and to a lesser extent in bipolar disorder. An indirect test of this theory conducted in animal experiments lend support to this N-CAM hypothesis. N-CAM dysregulation is consistent with a synaptic abnormality that could underlie the disconnection between brain regions consistent with neuroimaging reports. Synapse stability and plasticity may be part of the molecular neuropathology of these disorders.