Recent research suggests that functional connectivity changes may be involved in the pathophysiology of psychiatric disorders. Hyperconnectivity in the default mode network has been associated with psychopathology, but psychedelic serotonin agonists like psilocybin may profoundly disrupt these dysfunctional neural network circuits and provide a novel treatment for psychiatric disorders. We have reviewed the current literature to investigate the efficacy and safety of psilocybin-assisted therapy for the treatment of psychiatric disorders. There were seven clinical trials that investigated psilocybin-assisted therapy as a treatment for psychiatric disorders related to anxiety, depression, and substance use. All trials demonstrated reductions in psychiatric rating scale scores or increased response and remission rates. There were large effect sizes related to improved depression and anxiety symptoms. Psilocybin may also potentially reduce alcohol or tobacco use and increase abstinence rates in addiction, but the benefits of these two trials were less clear due to open-label study designs without statistical analysis. Psilocybin-assisted therapy efficacy and safety appear promising, but more robust clinical trials will be required to support FDA approval and identify the potential role in clinical psychiatry.