Psychotic symptoms are common in older adults and reflect a variety of psychiatric and medical conditions. Antipsychotic drugs form the core of the treatment of these symptoms; however, treatment of the elderly is complicated by a high frequency of comorbid medical illnesses, risk of side effects, and age-related changes in pharmacodynamics and pharmacokinetics. The superior safety and efficacy of atypical antipsychotics makes them first-line agents for managing psychotic patients with schizophrenia. Their uses now extend to other conditions such as schizoaffective disorders, delusional disorder, and mood disorders with psychotic features. Although the drugs have been studied extensively in young subjects, well-designed, double-blind, placebo-controlled studies are relatively lacking in the elderly. Our knowledge of their safety, efficacy and dosage in older adults is based on a few studies with small samples or extrapolated from studies of younger patients. Several psychiatric and medical conditions that are associated with psychotic symptoms in older people are reviewed, as well as how these patients may benefit from treatment with these agents.