Until recently, genetic approaches in psychiatric disease had enjoyed limited success, but large-scale collaborative a genome-wide association studies (GWAS) have now begun to identify common and rare variants associated with schizophrenia, bipolar disorder and autism spectrum disorders [1–11]. An alternative to these agnostic, large-scale approaches is to focus instead on phenotypes thought to reflect disease processes. In this review we refer to these phenotypes as intermediate phenotypes, rather than endophenotypes. Definitions of ‘endophenotype’ grace every review of this area (see Box 1 for some examples), and they are not all alike. For our purposes, the critical distinction is between definitions in which an endophenotype is considered to lie on the causal pathway to disease, and those in which it is more generally an index of the likelihood that a subject has the disease (and could serve as a biomarker). This distinction, noted by Walters and Owen [12], has been treated in detail by Kendler and Neale [13]. Here we distinguish two ways in which intermediate phenotypes could be used in genetic studies, and review their utility in genetic analysis of psychiatric disease.