The personality dimension of schizotypy is well established, and schizotypal traits can be taken to represent a proneness toward developing psychosis. Yet, there are competing theories about the latent structure of schizotypy. More specifically, there is controversy over the extent to which this propensity towards psychosis is present only in a small proportion of the population, or whether it is spread dimensionally throughout the general community. On the basis of accumulating research findings the present article argues for a fully dimensional model of schizotypy. It describes recent neurobiological, neuropsychological, social and environmental evidence supporting the idea that schizotypy in healthy populations, and disorders on the schizophrenia spectrum are fundamentally linked. Directions for further research are also considered.