Mental disorders account for around one-third of disability worldwide and cause enormous personal and societal burden. Current pharmacotherapies and nonpharmacotherapies do help many patients, but there are still high rates of partial or no response, delayed effect, and unfavorable adverse effects. The current diagnostic taxonomy of mental disorders by the Diagnostic and Statistical Manual of Mental Disorders and the International Classification of Diseases relies on presenting signs and symptoms, but does not reflect evidence from neurobiological and behavioral systems. However, in the last decades, the understanding of biological mechanisms underlying mental disorders has grown and can be used for the development of precision medicine, that is, to deliver a patient-tailored individual treatment. Precision medicine may incorporate genetic variants contributing to the mental disorder and the response to pharmacotherapies, but also consider gene ¥ environment interactions, blood-based markers, neuropsychological tests, data from electronic health records, early life adversity, stressful life events, and very proximal factors such as lifestyle, nutrition, and sport. Methods such as artificial intelligence and the underlying machine learning and deep learning approaches provide the framework to stratify patients, initiate specific tailored treatments and thus increase response rates, reduce adverse effects and medical errors. In conclusion, precision medicine uses measurable health parameters to identify individuals at risk of a mental disorder, to improve the diagnostic process and to deliver a patient-tailored treatment.