The prefrontal cortex exerts a potent regulatory influence over subcortical systems that are involved in the regulation of affective states. In particular, the amygdala is a region that is known to play a prominent role in the expression of emotions, and this function is believed to be disrupted in affective disorders and drug abuse. In addition, dysfunction of the prefrontal cortex is believed to be a common element in many psychiatric disorders such as schizophrenia. Using electrophysiological recordings in rodents, we examined the interactions of the prefrontal cortex with the amygdala. Our studies showed that these areas are strongly interdependent, with the prefrontal cortex showing conditioned responses that depend on amygdala inputs, and in turn exerting a potent attenuation of activity within the amygdala. In particular, the ability of the prefrontal cortex to modulate amygdala activity is likely to play an important role in our ability to cope with stressors. We propose that a dysfunction within the prefrontal cortex disrupts the ability of this region to effectively modulate the amygdala, leaving the organism susceptible to detrimental effects of stressors. This would appear to be a common underlying process that may leave the individual susceptible to drug abuse and to the onset or exacerbation of psychiatric disorders such as schizophrenia and depression.