We selectively review recent research findings in the field of psychoimmunology which test the hypotheses that immunological dysfunction may be aetiologically related to mental illnesses such as schizophrenia, and that certain morbid affective states such as depression and other forms of psychosocial distress may be the cause of immunosuppression and through this mechanism affect the outcome of illnesses such as cancer. Our examination of research implicating immunological or infective mechanisms in the aetiology of schizophrenia indicates that most studies have been unable to control for major methodological difficulties but the compatibility of these theories with the dopamine hypothesis suggests that further research attention is warranted. More clearly, there is growing evidence demonstrating a link between depression, other states of psychological distress and immunosuppression, but the clinical significance of these findings remains uncertain. The complex relationship between stress and the outcome of illnesses such as cancer is discussed and the possible implications of these findings for clinical psychiatry are suggested.