The introduction of second-generation antipsychotics and cognitive therapies for schizophrenia over the past two decades generated considerable optimism about possibilities for recovery. To what extent have these developments resulted in better outcomes for affected individuals? What is the current state of our science and how might we address the many unmet needs in the prevention and treatment of schizophrenia? We trace the evolution of various treatments for schizophrenia and summarize current knowledge about available pharmacological and psychosocial treatments. We consider the widely prevalent efficacy-effectiveness gap in the application of available treatments and note the significant variability in individual treatment response and outcome. We outline an individualized treatment approach which emphasizes careful monitoring and collaborative decision-making in the context of ongoing benefit-risk assessment. We note that the evolution of both pharmacological and psychosocial treatments thus far has been based principally on serendipity and intuition. In view of our improved understanding of the etiology and pathophysiology of schizophrenia, there is an opportunity to develop prevention strategies and treatments based on this enhanced knowledge. In this context, we discuss potential psychopathological treatment targets and enumerate current pharmacological and psychosocial development efforts directed at them. Considering the stages of schizophrenic illness, we review approaches to prevent progression from the pre-symptomatic high-risk to the prodrome to the initial psychotic phase to chronicity. In view of the heterogeneity of risk factors, we summarize approaches towards targeted prevention. We evaluate the potential contribution of pharmacogenomics and other biological markers in optimizing individual treatment and outcome in the future. (c) 2010 Elsevier B.V. All rights reserved.