Oral synthetic retinoids have been established as effective systemic therapy for psoriasis since their introduction for clinical use in the 1970s. Acitretin, the free acid of etretinate and its active metabolite, has replaced etretinate as the retinoid of choice for treating psoriasis because of its more favorable pharmacokinetic profile. Despite the demonstrated clinical success of retinoid therapy in psoriasis and other proliferative skin disorders, their mechanism of action has not been fully elucidated. Altered vitamin A metabolism, characterized by an increase in the formation of retinoic acid, has been demonstrated in psoriatic lesions and is potentially influenced by cytokines such as interferon gamma, which is present in high levels in these lesions. Synthetic retinoids such as acitretin may interfere with such cytokine-induced alterations. Studies on nuclear retinoic acid receptors have shown that acitretin activates all 3 receptor subtypes (RAR-alpha, -beta, and -gamma) without measurable receptor binding; this paradox remains unexplained. Further studies on nuclear receptor binding and activity, including possible receptor crosstalk with vitamin D nuclear receptors, promise to enhance understanding of the usefulness of retinoids in treatment of psoriasis. (J Am Acad Dermatol 1999;41:S2-6.)