Major depressive disorder (MDD) is a common psychiatric illness with high levels of morbidity and mortality. Despite intensive research during the past several decades, the neurobiological basis and pathophysiology of depressive disorders remain unknown. Genetic factors play important roles in the development of MDD, as indicated by family, twin, and adoption studies, and may reveal important information about disease mechanisms. This article describes recent developments in the field of psychiatric genetics, with a focus on MDD. Early twin studies, linkage studies, and association studies are discussed. Recent findings from genome-wide association studies are reviewed and future directions discussed. Despite all efforts, thus far, no single genetic variation has been identified to increase the risk of depression substantially. Genetic variants are expected to have only small effects on overall disease risk, and multiple genetic factors in conjunction with environmental factors are likely necessary for the development of MDD. Future large-scale studies are needed to dissect this complex phenotype and to identify pathways involved in the etiology of MDD.