Several psychiatric diseases are considered to be neuro-developmental disorders. Amongst these are schizophrenia and autism, in which genetic and environmental components have been indicated. In these disorders intrinsic molecular mechanisms of brain development may be deranged due to genetic predispositions, or modified by external influences. Brain development is a delicate process of well-tuned cellular proliferation and differentiation of multipotent neural progenitor cells driven by spatiotemporal cues. One of the fundamental mechanisms is the interaction between external signals, e.g. growth factors, and internal regulators, e.g. transcription factors. An important transmitter system involved in behavioural and affective functions relevant for psychiatric disorders is the mesencephalic dopamine (DA) system. The mesencephalic DA system is organized in two anatomically and functionally different systems. DA neurons in the ventral tegmental area project to the mesolimbic system and are mostly related to control of behaviour. It has been implicated in drug addiction and affective disorders like dipolar disorder and schizophrenia. The dopamine system of the substantia nigra (nigro-striatal pathway) is implicated in movement control. Degeneration of this system, as in Parkinson's disease, or altered function in tardive dyskinesia have highlighted its importance in human disease. Recent findings in molecular neurobiology have provided the first clues to molecular mechanisms involved in developing and mature DA neurons. These may have clinical implications in novel therapeutic strategies.