Neurodegenerative, neurodevelopmental and neuropsychiatric disorders are among the greatest public health challenges, as many lack disease-modifying treatments. A major reason for the absence of effective therapies is our limited understanding of the causative molecular and cellular mechanisms. Genome-wide association studies are providing a growing catalogue of disease-associated genetic variants, and the next challenge is to elucidate how these variants cause disease and to translate this understanding into therapies. This Review describes how new CRISPR-based functional genomics approaches can uncover disease mechanisms and therapeutic targets in neurological diseases. The bacterial CRISPR system can be used in experimental disease models to edit genomes and to control gene expression levels through CRISPR interference (CRISPRi) and CRISPR activation (CRISPRa). These genetic perturbations can be implemented in massively parallel genetic screens to evaluate the functional consequences for human cells. CRISPR screens are particularly powerful in combination with induced pluripotent stem cell technology, which enables the derivation of differentiated cell types, such as neurons and glia, and brain organoids from cells obtained from patients. Modelling of disease-associated changes in gene expression via CRISPRi and CRISPRa can pinpoint causal changes. In addition, genetic modifier screens can be used to elucidate disease mechanisms and causal determinants of cell type-selective vulnerability and to identify therapeutic targets.