The aim of this review is to analyze the available literature regarding the neuropsychiatric (NP) disturbances associated with corticosteroid (CS) therapy; to determine the nature, severity, and frequency of these NP symptoms; and to identify the various risk factors involved in the development of CS-induced NP disturbances. We searched the available literature since the advent of corticosteroid therapy (1950) utilizing the PubMed database ( www.pubmed.gov). Primary articles were identified, and they and their pertinent references were reviewed. Due to potential confusion between NP manifestations of CS therapy and central nervous system (CNS) involvement of systemic lupus erythematosus (SLE), a condition often treated with CS, a brief review of NP manifestations of SLE was also performed. The presentation of CS-induced neuropsychiatric disorders (CIPD) can be quite varied with depression, hypomania, and overt psychosis being the most common manifestations. CIPD can also include bipolar affective changes, delirium, panic attacks, agoraphobia, obsessive-compulsive disorder, anxiety, insomnia, restlessness, fatigue, catatonia, reversible dementia-like cognitive changes, impaired memory, and concentration. No factors have been identified that allow for the accurate prediction of development of CIPD. A dose-dependent relationship (increased risk when the daily prednisone-equivalent dose is ≥40 mg) has been observed in most cases of CIPD, although there have been case reports with lower doses, alternate-day therapy, and even inhaled CS. Women are more commonly affected with most symptoms occurring in the first 6 weeks of starting treatment. SLE has been the only specific illness that has been linked to a greater risk of CIPD and the NP manifestations of SLE may mimic those of CIPD, with most occurring in the first year of diagnosis. Antiribosomal P, antineuronal, or antiphospholipid antibodies are frequently seen in patients with SLE developing CIPD. Imaging and EEG abnormalities, the coexistence of non-CNS manifestations of SLE, and the presence of serious disturbances in memory and concentration are more suggestive of NP-SLE than CIPD. Although NP symptoms associated with the use of CS generally resolve with discontinuation of the medication, prophylaxis with lithium, and treatment with antidepressants, anticonvulsants and electroconvulsive therapy for severe mania and depression have been reported with successful outcomes. A greater understanding of the underlying mechanism of CIPD, risk factors involved, treatment options, and the distinguishing features from NP-SLE will ultimately lead to more directed therapy for such patients.