Placebo and nocebo effects are often regarded by clinicians as either a quaint reminiscence from the pre-therapeutic era, or simply as a technique for establishing the efficacy of therapeutic interventions within the locus of evidence-based practice. However, neither of these explanations sufficiently account for their complexity or their persistence and impact in clinical medicine. Placebo and nocebo effects are embedded in the very fabric of therapeutic relationships and are both a manifestation and outcome of the rituals that characterise clinical practice. They are also a stark reminder of the many personal and environmental factors, including the attitudes, beliefs and expectations of both doctor and patient, that shape the outcomes of health professional-patient interactions. We describe how recent biological and neuropsychiatric data have clarified the operation of placebo and nocebo effects in clinical practice - demonstrating the ability of the therapeutic context to modulate endogenous biological processes in a targeted manner. This, in turn, illustrates the potent philosophical and sociocultural aspects of medical praxis.