Psychedelic drugs are making waves as modern trials support their therapeutic potential and various media continue to pique public interest. In this opinion piece, we draw attention to a long-recognised component of the psychedelic treatment model, namely ‘set’ and ‘setting’ – subsumed here under the umbrella term ‘context’. We highlight: (a) the pharmacological mechanisms of classic psychedelics (5-HT2A receptor agonism and associated plasticity) that we believe render their effects exceptionally sensitive to context, (b) a study design for testing assumptions regarding positive interactions between psychedelics and context, and (c) new findings from our group regarding contextual determinants of the quality of a psychedelic experience and how acute experience predicts subsequent long-term mental health outcomes. We hope that this article can: (a) inform on good practice in psychedelic research, (b) provide a roadmap for optimising treatment models, and (c) help tackle unhelpful stigma still surrounding these compounds, while developing an evidence base for long-held assumptions about the critical importance of context in relation to psychedelic use that can help minimise harms and maximise potential benefits.