This overview presents selected recent developments in twin studies of adult psychiatric disorders. Subjects examined include the generalizability of heritability estimates, the impact of sex on patterns of familial transmission, gene-environment interaction, twin studies of anxiety and eating disorders, the so-called family environment, special issues raised by twin studies of drug use and abuse, and gene-environment correlation. The studies reviewed suggest that (1) the heritability of many behavioral traits may be greater in permissive than in restrictive environments and, (2) for psychiatric and drug abuse disorders, genes probably work through both traditional within-the-skin physiological pathways and outside-the-skin behavioral pathways. In the latter, genes affect aspects of the social environment, such as exposure to stressful life events and levels of social support, which in turn feed back on risk of illness. Twin studies remain a vibrant part of the field of psychiatric genetics and an important complement to and context for current efforts to localize individual susceptibility genes.