Compelling preclinical evidence indicates that the nonapeptide hormone oxytocin has a critical role in the regulation of brain-mediated processes that are strongly relevant to many neuropsychiatric disorders. The fact that oxytocin has long been approved for non-CNS uses in humans has provided an unusually auspicious opportunity to conduct investigations of its CNS effects in human subjects without requiring the lengthy and expensive preclinical and clinical toxicology studies that typically hinder translational human research of promising novel compounds. Taking advantage of this favorable situation, investigators have generated a plethora of small studies demonstrating that even a single dose of intranasally delivered oxytocin can have striking effects on human cognition and behavior. Though an oversimplification, these effects can broadly be characterized as pro-social in nature (review Macdonald and Macdonald, 2010). Understandably, those findings have generated much discussion about the possibility of translating oxytocin's effects into therapeutic applications, with autism spectrum disorders and social phobia garnering the most attention. However, it is schizophrenia, in which the application of oxytocin as putative therapeutic has advanced the furthest to date. Several positive findings with oxytocin in animal models with predictive validity for antipsychotics (eg Feifel and Reza, 1999; Lee et al, 2005) inspired our group to conduct a proof-of-concept human trial: a double-blinded, placebo-controlled crossover design enrolling schizophrenia patients who were highly symptomatic despite receiving therapeutic doses of an atypical antipsychotic. The results revealed that intranasal oxytocin (40 international units twice a day), administered as an adjunct to subjects’ antipsychotic drugs for 3 weeks improved positive and negative symptoms significantly more than placebo (Feifel et al, 2010). In addition, oxytocin improved the performance on a verbal memory task (CVLT-II) (manuscript in preparation). Recently an independent group of investigators at University of North Carolina conducting an independent trial of adjunctive intranasal oxytocin in schizophrenia also reported positive therapeutic effects (Pedersen et al, 2010). These positive therapeutic findings are indirectly bolstered by growing evidence of endogenous oxytocin's role in the manifestation of schizophrenia symptoms. For example, a recent study found higher plasma oxytocin levels were associated with more pro-social behavior in schizophrenia patients and with less severe psychopathology in female patients (Rubin et al, 2010). The mechanisms underlying oxytocin's beneficial effects on schizophrenia symptoms are not known, but candidate processes are its known ability to regulate mesolimbic dopamine pathways and modify activation of the amygdala. Based upon the promising initial findings our group and others are now conducting larger clinical trials of intranasal oxytocin in schizophrenia and proof-of-concept studies in other disorders are also underway. However, many questions need to be addressed in order to develop optimized oxytocin-based treatments. For example, what is the optimal intranasal dose and dosing schedule for long-term therapeutic CNS effects? Also, is the intranasal route the optimum route of delivering oxytocin? Furthermore, development of proprietary oxytocin mimetics, preferably small molecule agonists, is needed to facilitate industry interest in this therapeutic target and accelerate translation of oxytocin's promise into widely available treatments. If these challenges can be met and the positive early results hold up in larger trials, it may signal the beginning of an exciting new era in the treatment of schizophrenia and perhaps other neuropsychiatric disorders, something desperately needed given the disappointing lack of progress in developing efficacious novel mechanism treatments in this field.