Accumulating evidence suggests that hypothalamo-pituitary-thyroid (HPT) axis dysfunction is relevant to the pathophysiology and clinical course of bipolar affective disorder. Hypothyroidism, either overt or more commonly subclinical, appears to the commonest abnormality found in bipolar disorder. The prevalence of thyroid dysfunction is also likely to be greater among patients with rapid cycling and other refractory forms of the disorder. Lithium-treatment has potent antithyroid effects and can induce hypothyroidism or exacerbate a preexisting hypothyroid state. Even minor perturbations of the HPT axis may affect the outcome of bipolar disorder, necessitating careful monitoring of thyroid functions of patients on treatment. Supplementation with high dose thyroxine can be considered in some patients with treatment-refractory bipolar disorder. Neurotransmitter, neuroimaging, and genetic studies have begun to provide clues, which could lead to an improved understanding of the thyroid-bipolar disorder connection, and more optimal ways of managing this potentially disabling condition.