The earliest stages of delusion are characterized by an overabundance of meaningful coincidences impinging on the sufferer's existing worldview. Successive events are seen by him as pointing to, and then confirming, a fundamentally new reality that takes him over and engulfs his everyday life. Research over the last 4 decades has revealed the importance of dopamine (DA), D2 receptors, and the basal ganglia in psychotic thinking. Recent work has implicated the aberrant reward learning initiated by the excess release of striatal DA in the attribution of excessive importance or "salience" to insignificant stimuli and events. But our knowledge of what is happening beyond D2 receptors has remained scant. The gap is especially apparent at the cellular and microcircuit levels, encompassing the plastic changes, which are believed to be essential for new learning, and whose processes may go awry in major mental illness. Now new pharmacological findings are advancing our understanding of information processing and learning within the striatum. DA has an important role in setting the strength of individual striatal connections, but it does not act in isolation. Two other modulator systems are critical, the endocannabinoids and adenosine. Thus, at medium spiny neurons belonging to the indirect pathway, D2 stimulation evokes endocannabinoid-mediated depression of cortical inputs. Adenosine acting at A2A receptors elicits the opposite effect. Remarkably, drugs that target the endocannabinoid and purinergic systems also have pro- or antipsychotic properties. Here, we discuss how the 3 modulators regulate learning within the striatum and how their dysfunction may lead to delusional thinking.