Magnetic resonance diffusion tensor imaging (DTI) is a new technique that can be used to visualize and measure the diffusion of water in brain tissue; it is particularly useful for evaluating white matter abnormalities. In this paper, we review research studies that have applied DTI for the purpose of understanding neuropsychiatric disorders. We begin with a discussion of the principles involved in DTI, followed by a historical overview of magnetic resonance diffusion-weighted imaging and DTI and a brief description of several different methods of image acquisition and quantitative analysis. We then review the application of this technique to clinical populations. We include all studies published in English from January 1996 through March 2002 on this topic, located by searching PubMed and Medline on the key words "diffusion tensor imaging" and "MRI." Finally, we consider potential future uses of DTI, including fiber tracking and surgical planning and follow-up.