The term epigenetic refers to long-lasting changes in gene expression that are beyond the DNA base sequence. Understanding the dynamic role of epigenetic mechanisms in the regulation of gene expression in adulthood has led researchers to investigate epigenetic mechanisms in psychiatric disorders. The aim of this review was to describe epigenetic mechanisms and to discuss the role of epigenetic modifications in stress, depression, schizophrenia, and substance dependence. For this purpose PubMed was searched using the keywords epigenetic, stress, depression, schizophrenia, and substance dependence; studies published between 2000 and 2011 were reviewed. Different maternal behavioral patterns and early life stress have been reported to yield heritable changes in gene expression via epigenetic mechanisms, which are reversible. Studies that investigated the role of epigenetic modifications in stress and depression focused on the proteins involved in the regulation of the hypothalamo-pituitary adrenal (HPA) axis, whereas epigenetic studies of schizophrenia primarily focused on changes in the GABAergic system. Studies on substance dependence, on the other hand, showed that substance use might change the expression of many genes by causing short- or long-lasting epigenetic modifications. These findings have led to the development of new therapeutic strategies that target epigenetic mechanisms. Among these strategies, histone deacetylase inhibitors are especially promising. More studies are needed to improve our understanding of the role of epigenetic modifications in the development of psychiatric disorders, and to aid in the development of new treatment strategies that focus on epigenetic mechanisms.