Drug addiction is a chronic relapsing brain disorder characterized by a compulsion to take a drug with loss of control over drug intake. The hypothesis under discussion here is that chronic drug use produces long-lasting dysfunctions in neurons associated with the brain reward circuitry, and this "functional neurotoxicity" of drugs of abuse leads to vulnerability to relapse and continued drug dependence. Several sources of reinforcement are associated with various components of the drug addiction cycle and much progress has been made in identifying the midbrain-basal forebrain neural elements involved in the positive reinforcing effects of drugs of abuse and more recently in the neural elements involved in the negative reinforcement associated with drug addiction. Key elements for the acute reinforcing effects of drugs of abuse include a macrostructure in the basal forebrain called the extended amygdala that contains parts of the nucleus accumbens and amygdala and involves key neurotransmitters such as dopamine, opioid peptides, serotonin, GABA, and glutamate. Withdrawal from drugs of abuse is associated with subjective symptoms of negative affect and dysregulation of brain reward systems involving some of the same neurochemical systems implicated in the acute reinforcing effects of drugs of abuse. In addition, the functional toxicity of acute withdrawal is accompanied by recruitment of the brain stress neurotransmitter system corticotrophin-releasing factor. During more prolonged abstinence, post-acute withdrawal, evidence is accumulating of continued dysregulation of the neural systems associated with drug reinforcement and stress, regulation that may represent more subtle but persistent functional neurotoxic effects of chronic drug use and could be responsible for long-lasting vulnerability to relapse. Such functional neurotoxicity could be hypothesized to lead to a change in set point for drug reward that may represent an allostatic state contributing to vulnerability to relapse and re-entry into the addiction cycle. Elucidation of the specific neuropharmacological changes contributing to this prolonged functional neurotoxicity will be the challenge of future research on the neurobiology of drug addiction.