Psychiatric disorders represent a large economic burden in modern societies. However, pharmacological treatments are still far from optimal. Drugs used in the treatment of major depressive disorder (MDD) and anxiety disorders (selective serotonin [5-HT] reuptake inhibitors [SSRIs] and serotonin-noradrenaline reuptake inhibitors [SNRIs]) are pharmacological refinements of first-generation tricyclic drugs, discovered by serendipity, and show low efficacy and slowness of onset. Moreover, antipsychotic drugs are partly effective in positive symptoms of schizophrenia, yet they poorly treat negative symptoms and cognitive deficits. The present article reviews the neurobiological basis of 5-HT1A receptor (5-HT1A-R) function and the role of pre- and post-synaptic 5-HT1A-Rs in the treatment of MDD, anxiety and psychotic disorders. The activation of postsynaptic 5-HT1A-Rs in corticolimbic areas appears beneficial for the therapeutic action of antidepressant drugs. However, presynaptic 5-HT1A-Rs play a detrimental role in MDD, since individuals with high density or function of presynaptic 5-HT1A-Rs are more susceptible to mood disorders and suicide, and respond poorly to antidepressant drugs. Moreover, the indirect activation of presynaptic 5-HT1A-Rs by SSRIs/SNRIs reduces 5-HT neuron activity and terminal 5-HT release, thus opposing the elevation of extracellular 5-HT produced by blockade of the serotonin transporter (SERT) in the forebrain. Chronic anti-depressant treatment desensitizes presynaptic 5-HT1A-Rs, thus reducing the effectiveness of the 5-HT1A autoreceptor-mediated negative feedback. The prevention of this process by the non-selective partial agonist pindolol accelerates clinical antidepressant effects. Two new antidepressant drugs, vilazodone (marketed in the USA) and vortioxetine (in development) incorporate partial 5-HT1A-R agonist properties with SERT blockade. Several studies with transgenic mice have also established the respective role of pre- and post-synaptic 5-HT1A-Rs in MDD and anxiety. In agreement with pharmacological studies, presynaptic and postsynaptic 5-HT1A-R activation appears necessary for anxiolytic and antidepressant effects, respectively, yet, neurodevelopmental roles for 5-HT1A-Rs are also involved. Likewise, the use of small interference RNA has enabled the showing of robust antidepressant-like effects in mice after selective knock-down of 5-HT1A autoreceptors. Postsynaptic 5-HT1A-Rs in the prefrontal cortex (PFC) also appear important for the superior clinical effects of clozapine and other second-generation (atypical) antipsychotic drugs in the treatment of schizophrenia and related psychotic disorders. Despite showing a moderate in vitro affinity for 5-HT1A-Rs in binding assays, clozapine displays functional agonist properties at this receptor type in vivo. The stimulation of 5-HT1A-Rs in the PFC leads to the distal activation of the mesocortical pathway and to an increased dopamine release in PFC, an effect likely involved in the clinical actions of clozapine in negative symptoms and cognitive deficits in schizophrenia. The anxiolytic/antidepressant properties of 5-HT1A-R agonists in preclinical tests raised expectations enormously. However, these agents have achieved little clinical success, possibly due to their partial agonist character at postsynaptic 5-HT1A-Rs, together with full agonist properties at presynaptic 5-HT1A autoreceptors, as well as their gastrointestinal side effects. The partial 5-HT1A-R agonists buspirone, gepirone, and tandospirone are marketed as anxiolytic drugs, and buspirone is also used as an augmentation strategy in MDD. The development of new 5-HT1A-R agonists with selectivity for post-synaptic 5-HT1A-Rs may open new perspectives in the field.