Is it really paranoia
or is somebody after me?!
--Dope, "Paranoia"
Antipsychotic drugs (APs) are medications approved to treat many forms of psychoses (delusional and hallucination disorders), the prime disorder, of course, being schizophrenia. All currently available antipsychotics work their magic on the psychoses by blocking dopamine receptors. Some also block certain serotonin receptors, which many researchers think plays an important role in their effectiveness.
The US FDA has also approved some antipsychotics for short-term treatment in the manias of bipolar disorder (manic-depressive illness). Also, the newer antipsychotic olanzapine (US: ZYPREXA) recently gained approval for the overall long-term treatment of bipolar disorders (i.e., it's approved for more than just quashing manias, it also prevents them, apparently!).
Some doctors swear by the helpfulness of APs in depressed patients and may prescribe small doses of them alongside antidepressant medications.
The most common classification of the antipsychotic drugs (APs) is the division between "typical" (TAP) and "atypical" (AAP) antipsychotics. TAPs were, of course, the first of antipsychotics to become available (sometime in the 1950s). The generation of AAPs began in 1991, which is when clozapine (US: CLOZARIL) was approved for the treatment of schizophrenia. Due to a major side effect of clozapine (specifically, "agranulocytosis", which essentially is a rapid loss of your entire immune system), this drug was initially superceded in use by olanzapine in 1996, and other atypical antipsychotics as they came out.
TAPs such as haloperidol (US: HALDOL), chlorpromazine (US: THORAZINE), and many others, also have a notorious reputation for some nasty psychological side effects, ranging from a 24/7/365 "drugged-out" feeling to a somewhat ironic form of restlessness known as "akathisia". Akathisia can manifest itself on the milder end in a simple, annoying restlessness; however, severe akathisia can be bad enough to drive one to suicide(!). Effects resembling Parkinson disease (these effects are also known as "parkinsonism" or "extrapyrmidal symptoms (EPS)") would also occur with these TAPs. I suppose that this is all intuitive, as Parkinson disease (and related syndromes) are known to be caused by a lack of dopamine activity, and all APs happen to block dopamine!
Atypicals (AAPs), such as olanzapine, clozapine, aripiprazole (US: ABILIFY), risperidone (US: RISPERDAL), and many others, are of course a newer generation of APs that provide less of a side effect burden than do the TAPs, although parkinsonism/EPS as well as akathisia are still seen with these "atypicals".
Also, a particularly nasty parkinson-type disorder, Tardive Dyskinesia (TD), is a (mainly TAP-induced) disorder that occurs mainly in the face (with symptoms resembling facial tics). AAPs can also occasionally cause TD; risperidone is perhaps the most notorious for this. The disorder is generally seen in long-term AP therapy and does run the risk of being permanent, even after AP therapy has ended. Of course, even that AAP risperidone doesn't have as much risk of TD as say, haloperidol.
A rare side effect (mostly seen men taking TAPs) of antipsychotic treatment is the neuroleptic malignant syndrome, a potentially fatal drug reaction whose main signs are muscle rigidity (stiffness) and hyperpyrexia (very high fever).
The above was just a summary. For all intents and purposes, I pulled the above information out of my arse without really looking at authoritative sources. I'll be looking more seriously into these topics with the use of published sources (and of course, citations here) when I get the opportunity to write up the full version of this topic.