New hopes for cloning susceptibility genes for schizophrenia and bipolar affective disorder followed the discovery of a novel type of DNA mutation, namely unstable DNA. One class of unstable DNA, trinucleotide repeat expansion, is the causal mutation in myotonic dystrophy, fragile X mental retardation, Huntington disease and a number of other rare Mendelian neurological disorders. This finding has led researchers in psychiatric genetics to search for unstable DNA sites as susceptibility factors for schizophrenia and bipolar affective disorder. Increased severity and decreased age at onset of disease in successive generations, known as genetic anticipation, was reported for undifferentiated psychiatric diseases and for myotonic dystrophy early in the twentieth century, but was initially dismissed as the consequence of ascertainment bias. Because unstable DNA was demonstrated to be a molecular substrate for genetic anticipation in the majority of trinucleotide repeat diseases including myotonic dystrophy, many recent studies looking for genetic anticipation have been performed for schizophrenia and bipolar affective disorder with surprisingly consistent positive results. These studies are reviewed, with particular emphasis placed on relevant sampling and statistical considerations, and concerns are raised regarding the interpretation of such studies. In parallel, molecular genetic investigations looking for evidence of trinucleotide repeat expansion in both schizophrenia and bipolar disorder are reviewed. Initial studies of genome-wide trinucleotide repeats using the repeat expansion detection technique suggested possible association of large CAG/CTG repeat tracts with schizophrenia and bipolar affective disorder. More recently, three loci have been identified that contain large, unstable CAG/CTG repeats that occur frequently in the population and seem to account for the majority of large products identified using the repeat expansion detection method. These repeats localize to an intron in transcription factor gene SEF2-1B at 18q21, a site named ERDA1 on 17q21 with no associated coding region, and the 3' end of a gene on 13q21, SCA8, that is believed to be responsible for a form of spinocerebellar ataxia. At present no strong evidence exists that large repeat alleles at either SEF2-1B or ERDA1 are involved in the etiology of schizophrenia or bipolar disorder. Preliminary evidence suggests that large repeat alleles at SCA8 that are non-penetrant for ataxia may be a susceptibility factor for major psychosis. A fourth, but much more infrequently unstable CAG/CTG repeat has been identified within the 5' untranslated region of the gene, MAB21L1, on 13q13. A fifth CAG/CTG repeat locus has been identified within the coding region of an ion transporter, KCNN3 (hSKCa3), on 1q21. Although neither large alleles nor instability have been observed at KCNN3, this repeat locus has been extensively analyzed in association and family studies of major psychosis, with conflicting findings. Studies of polyglutamine containing genes i...