Serotonin (5-HT)-receptor-based mechanisms have been postulated to play a critical role in the action of the new generation of antipsychotic drugs (APDs) that are usually referred to as atypical APDs because of their ability to achieve an antipsychotic effect with lower rates of extrapyramidal side effects (EPS) compared to first-generation APDs such as haloperidol. Specifically, it has been proposed by Meltzer et al. [J. Pharmacol. Exp. Ther. 251 (1989) 238] that potent 5-HT2A receptor antagonism together with weak dopamine (DA) D2 receptor antagonism are the principal pharmacologic features that differentiate clozapine and other apparent atypical APDs from first-generation typical APD. This hypothesis is consistent with the atypical features of quetiapine, olanzapine, risperidone, and ziprasidone, which are the most common treatments for schizophrenia in the United States and many other countries, as well as a large number of compounds in various stages of development. Subsequent research showed that 5-HT1A agonism may be an important consequence of 5-HT2A antagonism and that substitution of 5-HT1A agonism for 5-HT2A antagonism may also produce an atypical APD drug when coupled with weak D2 antagonism. Aripiprazole, the most recently introduced atypical APD, and a D2 receptor partial agonist, may also owe some of its atypical properties to its net effect of weak D2 antagonism, 5-HT2A antagonism and 5-HT1A agonism [Eur. J. Pharmacol. 441 (2002) 137]. By contrast, the alternative "fast-off" hypothesis of Kapur and Seeman [Am. J. Psychiatry 158 (2001) 360] applies only to clozapine and quetiapine and is inconsistent with the "slow" off rate of most atypical APDs, including olanzapine, risperidone and ziprasidone. 5-HT2A and 5-HT1A receptors located on glutamatergic pyramidal neurons in the cortex and hippocampus, 5-HT2A receptors on the cell bodies of DA neurons in the ventral tegmentum and substantia nigra and GABAergic interneurons in the cortex and hippocampus, and 5-HT1A receptors in the raphe nuclei are likely to be important sites of action of the atypical APDs. At the same time, evidence has accumulated for the important modulatory role of 5-HT2C and 5-HT6 receptors for some of the effects of some of the current APDs. Thus, 5-HT has joined DA as a critical target for developing effective APDs and led to the search for novel drugs with complex pharmacology, ending the exclusive search for single-receptor targets, e.g., the D3 or D4 receptor, and drugs that are selective for them.