Neuropsychiatric disorders involve various pathological mechanisms, resulting in neurodegeneration and brain atrophy. Neurodevelopmental processes have shown to be critical for the progression of those disorders, which are based on genetic and epigenetic mechanisms as well as on extrinsic factors. We review here common mechanisms underlying the comorbidity of Bipolar Disorders and Alzheimer's Disease, such as aberrant neurogenesis and neurotoxicity, reporting current therapeutic approaches. The understanding of these mechanisms precedes stem cell-based strategies as a new therapeutic possibility for treatment and prevention of Bipolar and Alzheimer's Disease progression. Taking into account the difficulty of studying the molecular basis of disease progression directly in patients, we also discuss the importance of stem cells for effective drug screening, modeling and treating psychiatric diseases, once in vitro differentiation of patient-induced pluripotent stem cells provides relevant information about embryonic origins, intracellular pathways and molecular mechanisms.