The dexamethasone suppression test (DST) is considered to be a useful diagnostic test for hypothalamic-pituitary-adrenal (HPA) dysfunction in depression, but substantial doubt remains about its specificity. In this study, 21 healthy controls and 238 patients underwent the DST. The clinical diagnosis was made according to the Diagnostic and Statistical Manual for Mental Disorders, 3rd Edition (DSM-III). The specificity of the DST to endogenous depression was not as high as Carroll et al. reported, and the DST did not distinguish significantly between diagnostic categories of depression and schizophrenic disorders. The DST was a state dependent biological marker of the severity of symptoms including psychotic features in endogenous depression and schizophrenic disorders. The DST results indicated remarkable abnormality (post-dexamethasone cortisol level and DST positivity) in major depression with psychotic features, suggesting marked HPA dysfunction. Differential diagnosis is sometimes difficult between paranoid disorders in the aged and major depressive episodes with psychotic features. Nevertheless the DST should be useful in their differentiation, since the former disorder usually shows normal DST results. Accordingly, it was concluded that the DST could be used as a supplementary test in the study of various mental disorders and could be a valuable guide to the psychiatrist in combination with other biological markers.