Advances in genetic technology have focussed on how genetic polymorphisms may impact on drug metabolism, response, adverse effects and clinical outcome. As drug handling and response is significantly driven by genetic factors, genotyping holds promise for personalised medicines. However, high genetic variability and multiple drug effects present a significant challenge to provide useful guidelines in clinical practice. In addition, the expressions of polymorphic genes that control neurobiological functions and drug metabolising enzymes are also influenced by environmental and dietary factors. With the increasing accessibility and affordability of genotyping, predicting clinical efficacy and adverse effects in individuals from diverse backgrounds holds greater potential. Further research into the pharmacogenetic differences from cross-ethnic perspectives may increase our understanding of the effects of genetic variants on drug efficacy and tolerability. This is likely to enable more rational psychopharmacotherapy that can minimize adverse effects, enhance efficacy, improve adherence and save costs in the long term.