The geographic distribution and host range of Borna disease (BD), a fatal neurologic disease of horses and sheep, are larger than previously thought. The etiologic agent, Borna disease virus (BDV), has been identified as an enveloped nonsegmented negative-strand RNA virus with unique properties of replication. Data indicate a high degree of genetic stability of BDV in its natural host, the horse. Studies in the Lewis rat have shown that BDV replication does not directly influence vital functions; rather, the disease is caused by a virus-induced T-cell mediated immune reaction. Because antibodies reactive with BDV have been found in the sera of patients with neuropsychiatric disorders, this review examines the possible link between BDV and such disorders. Seroepidemiologic and cerebrospinal fluid investigations of psychiatric patients suggest a causal role of BDV infection in human psychiatric disorders. In diagnostically unselected psychiatric patients, the distribution of psychiatric disorders was found to be similar in BDV seropositive and seronegative patients. In addition, BDV-seropositive neurologic patients became ill with lymphocytic meningoencephalitis. In contrast to others, we found no evidence is reported for BDV RNA, BDV antigens, or infectious B DV in peripheral blood cells of psychiatric patients.