Despite having been discovered in 1800, the contemporary history of lithium salts in psychiatry began only in 1949. Lithium has proved to be a very effective treatment for patients with affective disorders. It can prevent both suicide and relapse in patients with bipolar disorder and is also effective as adjunctive treatment in unipolar depression. In spite of its well-known efficacy though, lithium is being used in clinical practice less often nowadays. Two of the reasons for this phenomenon are its narrow therapeutic index and its nephrotoxicity. The toxic effects of lithium in renal function began to trouble scientists approximately 40 years ago. Today, it is well documented that lithium can cause, in decreasing order of frequency, nephrogenic diabetes insipidus, chronic kidney disease and nephrotic syndrome. Unfortunately, chronic kidney disease may eventually lead to renal dialysis even if lithium administration is stopped. The relation between lithium treatment and manifestation of renal tumors has not been proved yet. The molecular and pathophysiological mechanisms of lithium-induced toxic renal effects are partially elucidated. Their knowledge increases the pharmacovigilance of clinical psychiatrist so as to use clinical examination and laboratory tests to properly detect or prevent renal side-effects and treat them in co-operation with nephrologists.