Latent inhibition (LI), namely, a retardation in conditioning to a stimulus, as a consequence of its prior non- reinforced pre-exposure, is disrupted in amphetamine-treated rats and humans and in some subsets of schizophrenic patients. One factor that has been repeatedly implicated in precipitating and/or exacerbating psychotic episodes is stress. Since a principal biological response to stress is the activation of the hypothalamic-pituitary-adrenocortical (HPA) axis, leading, as its end product, to the secretion of corticosterone, the present experiments tested whether increase in corticosterone levels following exogenous corticosterone administration would disrupt LI. Both repeated (Experiment 1) and acute (Experiment 2) administration of corticosterone led to LI disruption, providing evidence for the involvement of the HPA axis alterations in LI and further supporting the viability of disrupted LI as an animal model of psychosis. Both regimens also increased amphetamine-induced activity. We suggest that disrupted LI may reflect a cognitive mechanism whereby prolonged periods of increased corticosterone levels can lead to 'sensory flooding' characteristic of psychosis.