Ketamine exerts powerful anesthetic, psychotic, and antidepressant effects in both healthy volunteers and clinically depressed patients. Although ketamine targets particular glutamate receptors, there is a dearth of evidence for additional, alternative molecular substrates for the behavioral actions of this N-methyl-D-aspartate (NMDA) receptor antagonist drug. Here, we provide behavioral and molecular evidence for the actions of ketamine using a new vertebrate model for psychiatric disorders: the zebrafish. Subanesthetic doses of ketamine produced a variety of abnormal behaviors in zebrafish that were qualitatively analogous to those previously measured in humans and rodents treated with drugs that produce transient psychosis. In addition, we revealed that the transcription factor Phox2b is a molecular substrate for the actions of ketamine, particularly during periods of hypoxic stress. Finally, we also show that SIRT1, a histone deacetylase widely recognized for its link to cell survival is also affected by hypoxia crises. These results establish a relevant assay system in which the effects of psychotomimetic drugs can rapidly be assessed, and provide a plausible and novel neuronal mechanism through which ketamine affects critical sensory circuits that monitor breathing behavior.