In the first section of this paper several aspects of tardive dyskinesia (TD) (clinical, epidemiological, pharmacological) are reviewed. We propose that this syndrome is not the consequence of dopamine receptor proliferation, but results from damage or degeneration of striatal cholinergic interneurons. We suggest that this cellular damage is caused by prolonged overactivation of these neurons, which occurs when they are released from dopaminergic inhibition following neuroleptic administration. Overactivity of central cholinergic systems during akinetic and motor retarded depression could be a contributory cause. The predisposition to L-DOPA-induced peak-dose dyskinesia in Parkinson's disease may depend on the same type of striatal neuronal loss. In the second part of the paper, the subject of supersensitivity psychosis and drug-resistant schizophrenia is reviewed. These two syndromes, are commonly associated with TD, have similar predisposing factors and pharmacology to TD, and are potentially persistent. We suggest that these conditions also result from degeneration of cholinergic striatal interneurons following chronic neuroleptic administration. The efficacy of clozapine for such treatment-refractory psychoses is explained in terms of its blockade of D-1 dopamine receptors. Other drugs effective against refractory psychoses (e.g. risperidone) are predicted to reduce activation at D-1 receptors.