ABSTRACT: Functional neuroimaging studies of the anatomical correlates of familial major depressive disorder (MDD) and bipolar disorder (BD) have identified abnormalities of resting blood flow (BF) and glucose metabolism in depression in the amygdala and the orbital and medial prefrontal cortical (PFC) areas that are extensively connected with the amygdala. The amygdala metabolism in MDD and BD is positively correcated with both depression severity and “stressed” plasma cortisol concentrations measured during scanning. During antidepressant drug treatment, the mean amygdala metabolism decreases in treatment responders, and the persistence of elevated amygdala metabolism during remission is associated with a high risk for the development of depressive relapse. The orbital C Metabolism is also abnormally elevated during depression, but is negatively correlated with both depression severity and amygdala metabolism, suggesting that this structure may be activated as a compensatory mechanism to modulate amygdala activity or amygdala-driven emotional responses. The posterior orbital C and anterior cingulate C ventral to the genu of the corpus callosum (Subgenual PFC) have more recently been shown in morphometric MRI and/or post mortem histopathological studies to have reduced grey matter volume and reduced glial cell numbers (with no equivalent loss of neurons) in familial MDD and BD. These data suggest a neural model in which dysfunction of limbic PFC structures impairs the modulation of the amygdala, leading to abnormal processing of emotional stimuli. Antidepressant drugs may compensate for this dysfunction by inhibiting pathological limbic activity.