Psychiatric disorders are associated with significant social and economic burdens, many of which are related to issues with current diagnosis and treatments. The coronavirus (COVID-19) pandemic is estimated to have increased the prevalence and burden of major depressive and anxiety disorders, indicating an urgent need to strengthen mental health systems globally. To date, current approaches adopted in drug discovery and development for psychiatric disorders have been relatively unsuccessful. Precision psychiatry aims to tailor healthcare more closely to the needs of individual patients and, when informed by neuroscience, can offer the opportunity to improve the accuracy of disease classification, treatment decisions, and prevention efforts. In this review, we highlight the growing global interest in precision psychiatry and the potential for the National Institute of Health-devised Research Domain Criteria (RDoC) to facilitate the implementation of transdiagnostic and improved treatment approaches. The need for current psychiatric nosology to evolve with recent scientific advancements and increase awareness in emerging investigators/clinicians of the value of this approach is essential. Finally, we examine current challenges and future opportunities of adopting the RDoC-associated translational and transdiagnostic approaches in clinical studies, acknowledging that the strength of RDoC is that they form a dynamic framework of guiding principles that is intended to evolve continuously with scientific developments into the future. A collaborative approach that recruits expertise from multiple disciplines, while also considering the patient perspective, is needed to pave the way for precision psychiatry that can improve the prognosis and quality of life of psychiatric patients.