Despite the premature and somewhat infamous rise and fall of psychosurgery in the mid-20th century, the current era of functional neuromodulation proffers immense opportunity for surgical intervention in treatment-resistant psychiatric disorders. On the basis of recent successes with novel, focused, less invasive, and reversible treatment strategies for movement disorders, several therapeutic trials have been conducted to investigate the effectiveness of deep brain stimulation (DBS) in treatment-resistant depression, obsessive-compulsive disorder (OCD), and Tourette syndrome. The many anatomic targets for these psychiatric disorders are indicative of both the system-wide effects of DBS and the network-level dysfunction mediating the emotional and cognitive disturbances. To gain insight into the application of neuromodulation therapies and their further advancement, we must elucidate neuroanatomic networks involved in refractory psychiatric illness, the neurophysiological anomalies that contribute to disordered information processing therein, and the local and system-wide modulatory effects of DBS. This review discusses the history of psychosurgical procedures, recent DBS clinical data, current anatomic models of psychopathology, and possible therapeutic mechanisms of action of DBS neuromodulation. Our search criteria for PubMed included combinations of the following terms: neuromodulation, DBS, depression, OCD, Tourette syndrome, mechanism of action, and history. Dates were not restricted. As clinical and basic scientific investigations probe the neuromodulatory effects of DBS in the treatment of refractory neuropsychiatric illness, our knowledge of these disorders and our potential to treat them are rapidly expanding. Indeed, this modern era of neuromodulation may provide the key that unlocks many of the mysteries pertaining to the biological basis of disordered emotional neurocircuitry.