In 1984, a potent and selective interaction of the steroidal anaesthetic alphaxalone with the GABAA receptor was demonstrated. Subsequent studies established that certain naturally occurring steroids were potent positive allosteric modulators of the GABAA receptor. Although peripheral endocrine glands are an important endogenous source, the brain can synthesize 'neurosteroids', and these have the potential to influence the activity of the GABAA receptor in the CNS. Systemic administration of steroids have clear behavioural effects. In this article, Jeremy Lambert and colleagues review recent advances in this field and discuss the therapeutic potential of this novel, non-genomic effect of steroids and investigate whether they may influence behaviour under physiological, or pathophysiological, conditions.