Psoriasis is a common inflammatory skin disease of unknown etiology, for which there is no cure. This heterogeneous, cutaneous, inflammatory disorder is clinically characterized by prominent epidermal hyperplasia and a distinct inflammatory infiltrate. Crosstalk between immunocytes and keratinocytes, which results in the production of cytokines, chemokines and growth factors, is thought to mediate the disease. Given that psoriasis is only observed in humans, numerous genetic approaches to model the disease in mice have been undertaken. In this Review, we describe and critically assess the mouse models and transplantation experiments that have contributed to the discovery of novel disease-relevant pathways in psoriasis. Research performed using improved mouse models, combined with studies employing human cells, xenografts and patient material, will be key to our understanding of why such distinctive patterns of inflammation develop in patients with psoriasis. Indeed, a combination of genetic and immunological investigations will be necessary to develop both improved drugs for the treatment of psoriasis and novel curative strategies.