Stress in life is unavoidable, affecting everyone on a daily basis. Psychological stress in mammals triggers a rapidly organized response for survival, but it may also cause a variety of behavioral disorders and damage cognitive function. Stress is associated with biases in cognitive processing; some of the most enduring memories are formed by traumatic events. Our understanding of how cognition is shaped by stress is still relatively primitive; however, evidence is rapidly accumulating that the ‘mature’ brain has a great capacity for plasticity and that there are numerous ways through which pharmacological therapeutics could rescue cognitive function and regain cognitive balance. In this review, we discuss recent advances in our understanding of the interplay between stress and cognitive processes and potential therapeutic approaches to stress-related behavioral and cognitive disorders.