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Depressive disorder is a long term, relapsing condition associated with high levels of disability and mortality. It has a neurobiological basis and is associated with functional and structural brain abnormalities. The data discussed have been obtained mainly from meta-analyses, randomized controlled clinical trials and key review papers as well as animal studies. Genetic vulnerability and stress are key factors in its aetiopathogenesis. Dysregulation of the hypothalamo-pituitary-adrenal (HPA) axis reduces hippocampal volumes and prefrontal cortex (PFC) activity in depressed patients and disrupts homeostasis within the neurocircuit of depression. Antidepressant drugs increase brain-derived neurotrophin, restoring neuronal growth and activity and modulate interactions between the neurocircuit anatomical structures. It remains to be confirmed whether structural changes in the brain are purely abnormalities in neuroplasticity and are fully reversible, whether they predate depression and whether they increase in the long term. Investigation of the molecular mechanisms mediating gene and environment interaction is a growing and potentially fruitful area of research in the neurobiology of depression. Further elucidation of the neuroanatomical and physiological connections between the limbic structures and PFC may help identify key areas to target in treatment. The role of the dysregulation of the HPA axis and identifiable stressors in the recent or remote past which are not always present in depression need further study. Prospective studies examining the interaction between changes in brain function and structure in relation to stress and identified relevant genes and how these may be influenced by antidepressant drug treatment and the long-term course of depression would help clarify their role in the pathophysiology of this disorder.