Until recently, research on the neurochemical basis of affective disorders (AD) and schizophrenia (SCZ) focused on detecting postulated disturbances in presynaptic neurotransmitter release and metabolism, or postsynaptic receptor function. New insights into the molecular mechanisms involved in the propagation of neurotransmitter signals across biological membranes and in the regulation of neuronal responses have allowed the development of novel hypotheses, which may explain the altered postsynaptic neuroreceptor responsivity thought to be integral to the pathophysiology of these disorders. In this review we evaluate evidence from both basic science and clinical research implicating disturbances in postreceptor signal transduction in the pathophysiology and pharmacotherapy of AD and SCZ. Specific findings regarding potential postreceptor sites of pathophysiology are highlighted in each of these disorders, together with the growing body of data on the possible postreceptor loci of psychotropic drug action, especially lithium and antidepressants.