This paper reviews the findings from preclinical animal and human clinical research investigating maternal/fetal, neonatal, and child neurodevelopmental outcomes following prenatal exposure to psychotropic drugs. Evidence for the risks associated with prenatal exposure was examined, including teratogenicity, neurodevelopmental effects, neonatal toxicity, and long-term neurobehavioral consequences (i.e., behavioral teratogenicity). We conducted a comprehensive review of the recent results and conclusions of original research and reviews, respectively, which have investigated the short- and long-term impact of drugs commonly prescribed to pregnant women for psychological disorders, including mood, anxiety, and sleep disorders. Because mental illness in the mother is not a benign event, and may itself pose significant risks to both mother and child, simply discontinuing or avoiding medication use during pregnancy may not be possible. Therefore, prenatal exposure to psychotropic drugs is a major public health concern. Decisions regarding drug choice, dose, and duration should be made carefully, by balancing severity, chronicity, and co-morbidity of the mental illness, disorder, or condition against the potential risk for adverse outcomes due to drug exposure. Globally, maternal mental health problems are considered as a major public health challenge, which requires a stronger focus on mental health services that will benefit both mother and child. More preclinical and clinical research is needed in order to make well-informed decisions, understanding the risks associated with the use of psychotropic medications during pregnancy.