Benzodiazepines have a wide variety of indications. However, CNS and psychiatric adverse reactions, tolerance, and withdrawal effects of benzodiazepines are becoming increasingly recognized and must be better understood for proper drug use. Certain benzodiazepines are associated with memory impairment and other cognitive defects and hyperexcitability phenomena during treatment (early-morning insomnia, daytime anxiety) and following withdrawal (rebound insomnia and anxiety, seizures). Elimination half-life, receptor-binding affinity, effects on the locus coeruleus-norepinephrine (LC-NE) and hypothalamic-pituitary-adrenal (HPA) axes, and the interaction of these factors appear to be major determinants of frequency and severity of these untoward effects. Rapid drug elimination and high receptor-binding affinity were initially suggested as primary underlying factors which determine frequency, severity, and type of the side effects of benzodiazepines during administration and withdrawal. Newer data and information on triazolobenzodiazepines indicate that these psychiatric adverse reactions also relate to whether the benzodiazepine has strong direct effects on the LC-NE and HPA systems. Initial suppression of the LC-NE and HPA systems is followed, on an interdose basis, by a significant rebound and activation. This repetitive pattern of suppression followed by rebound results in a neurophysiologic and behavioral sensitization (kindling) of the limbic system and consequently contributes to central nervous system and psychiatric adverse reactions. The tendency of certain of these side effects to worsen over time supports empirically this neurophysiologic and biochemical model.