Because it is a rare and poorly understood condition, there is no definitive way to diagnose the Capgras delusion. Diagnosis is primarily made on psychological evaluation of the patient, who is most likely brought to a psychologist's attention by a family member or friend believed to be an imposter by the person under the delusion.

Psychosis is first and foremost a diagnosis of exclusion. So a new-onset episode of psychosis "cannot" be considered a symptom of a psychiatric disorder until other relevant and known causes of psychosis are properly excluded, or ruled out. Many clinicians improperly perform, or entirely miss this step, introducing avoidable diagnostic error and misdiagnosis.

An initial assessment includes a comprehensive history and physical examination by a physician, psychiatrist, psychiatric nurse practitioner or psychiatric physician assistant. Biological tests should be performed to exclude psychosis associated with or caused by substance use, medication, toxins, surgical complications, or other medical illnesses.

Delirium should be ruled out, which can be distinguished by visual hallucinations, acute onset and fluctuating level of consciousness, indicating other underlying factors, including medical illnesses. Excluding medical illnesses associated with psychosis is performed by using blood tests to measure:

- Thyroid-stimulating hormone to exclude hypo- or hyperthyroidism,

- Basic electrolytes and serum calcium to rule out a metabolic disturbance,

- Full blood count including ESR to rule out a systemic infection or chronic disease, and

- Serology to exclude syphilis or HIV infection.

Other investigations include:

- EEG to exclude epilepsy, and an

- MRI or CT scan of the head to exclude brain lesions.

Because psychosis may be precipitated or exacerbated by common classes of medications, medication-induced psychosis should be ruled out, particularly for first-episode psychosis. Both substance- and medication-induced psychosis can be excluded to a high level of certainty, using a

- Urinalysis and a

- Full serum toxicology screening.

Because some dietary supplements may also induce psychosis or mania, but cannot be ruled out with laboratory tests, a psychotic individual's family, partner, or friends should be asked whether the patient is currently taking any dietary supplements.

Common mistakes made when diagnosing people who are psychotic include:

- Not properly excluding delirium,

- Not appreciating medical abnormalities (e.g., vital signs),

- Not obtaining a medical history and family history,

- Indiscriminate screening without an organizing framework,

- Missing a toxic psychosis by not screening for substances "and" medications

- Not asking family or others about dietary supplements,

- Premature diagnostic closure, and

- Not revisiting or questioning the initial diagnostic impression of primary psychiatric disorder.

Only after relevant and known causes of psychosis are excluded, a mental health clinician may make a psychiatric differential diagnosis using a person's family history, incorporating information from the person with psychosis, and information from family, friends, or significant others.

Types of psychosis in psychiatric disorders may be established by formal rating scales. The Brief Psychiatric Rating Scale (BPRS) assesses the level of 18 symptom constructs of psychosis such as hostility, suspicion, hallucination, and grandiosity. It is based on the clinician's interview with the patient and observations of the patient's behavior over the previous 2–3 days. The patient's family can also answer questions on the behavior report. During the initial assessment and the follow-up, both positive and negative symptoms of psychosis can be assessed using the 30 item Positive and Negative Symptom Scale (PANSS).

Research efforts are focusing on prevention in identifying early signs from relatives with associated disorders similar with schizophrenia and those with prenatal and birth complications. Prevention has been an ongoing challenge because early signs of the disorder are similar to those of other disorders. Also, some of the schizophrenic related symptoms are often found in children without schizophrenia or any other diagnosable disorder.

Medications for schizophrenia are often used, especially when positive symptoms are present. Both first-generation antipsychotics and second-generation antipsychotics may be useful. Cognitive behavioral therapy has also been used.

Schizophrenia is diagnosed based on criteria in either the American Psychiatric Association's (APA) fifth edition of the "Diagnostic and Statistical Manual of Mental Disorders" (DSM 5), or the World Health Organization's International Statistical Classification of Diseases and Related Health Problems (ICD-10). These criteria use the self-reported experiences of the person and reported abnormalities in behavior, followed by a clinical assessment by a mental health professional. Symptoms associated with schizophrenia occur along a continuum in the population and must reach a certain severity and level of impairment, before a diagnosis is made. As of 2013 there is no objective test.

The same criteria are used to diagnose children and adults. Diagnosis is based on reports by parents or caretakers, teachers, school officials, and others close to the child.

A professional who believes a child has schizophrenia usually conducts a series of tests to rule out other causes of behavior, and pinpoint a diagnosis. Three different types of exams are performed: physical, laboratory, and psychological. Physical exams usually cover the basic assessments, including but not limited to; height, weight, blood pressure, and checking all vital signs to make sure the child is healthy. Laboratory tests include electroencephalogram EEG screening and brain imaging scans. Blood tests are used to rule out alcohol or drug effects, and thyroid hormone levels are tested to rule out hyper- or hypothyroidism. A psychologist or psychiatrist talks to a child about their thoughts, feelings, and behavior patterns. They also inquire about the severity of the symptoms, and the effects they have on the child's daily life. They may also discuss thoughts of suicide or self-harm in these one-on-one sessions. Some symptoms that may be looked at are early language delays, early motor development delays and school problems.

Many of persons with childhood schizophrenia are initially misdiagnosed as having pervasive developmental disorders (autism spectrum disorder, for example).

Individual therapy may be best suited to treat the individual's delusions. Persistence is needed in establishing a therapeutic empathy without validating the patient’s delusional system or overtly confronting the system. Cognitive techniques that include reality testing and reframing can be used. Antipsychotics and other therapeutic drugs have been used with relative success.

Recovery from this syndrome is situational, as some drug therapies have been effective in some individuals but not others. Patients may live in a variety of settings, including psychiatric hospitals, depending on the success of treatment. With successful treatment, an individual may live at home. In many of the reported cases, remission of symptoms occurred during the follow-up period.

This disorder can be dangerous to the patient and others, as a patient may interrogate or attack a person they believe to be a double. Inappropriate behavior such as stalking and physical or psychological abuse has been documented in some case studies. Consequently, many individuals suffering from this disorder are arrested for the resulting misconduct (see the case of Mr. B in #Presentation).

A widely accepted treatment for the syndrome of subjective doubles has not been developed. Treatment methods for this disease sometimes include the prescription of antipsychotic drugs, however, the type of drug prescribed depends on the presence of other mental disorders. Antipsychotic drugs (also known as neuroleptics) such as risperidone, pimozide, or haloperidol may be prescribed to treat the underlying psychiatric illness.

In addition to drug therapy, interpersonal counseling has also been suggested as a method to ease relations between the patient and his/her suspected doubles. However, the relationship between the patient and his/her double is not always negative.

In 2013, the American Psychiatric Association released the fifth edition of the DSM (DSM-5). To be diagnosed with schizophrenia, two diagnostic criteria have to be met over much of the time of a period of at least one month, with a significant impact on social or occupational functioning for at least six months. The person had to be suffering from delusions, hallucinations, or disorganized speech. A second symptom could be negative symptoms, or severely disorganized or catatonic behaviour. The definition of schizophrenia remained essentially the same as that specified by the 2000 version of DSM (DSM-IV-TR), but DSM-5 makes a number of changes.

- Subtype classifications – such as catatonic and paranoid schizophrenia – are removed. These were retained in previous revisions largely for reasons of tradition, but had subsequently proved to be of little worth.

- Catatonia is no longer so strongly associated with schizophrenia.

- In describing a person's schizophrenia, it is recommended that a better distinction be made between the current state of the condition and its historical progress, to achieve a clearer overall characterization.

- Special treatment of Schneider's first-rank symptoms is no longer recommended.

- Schizoaffective disorder is better defined to demarcate it more cleanly from schizophrenia.

- An assessment covering eight domains of psychopathology – such as whether hallucination or mania is experienced – is recommended to help clinical decision-making.

The ICD-10 criteria are typically used in European countries, while the DSM criteria are used in the United States and to varying degrees around the world, and are prevailing in research studies. The ICD-10 criteria put more emphasis on Schneiderian first-rank symptoms. In practice, agreement between the two systems is high. The current proposal for the ICD-11 criteria for schizophrenia recommends adding self-disorder as a symptom.

If signs of disturbance are present for more than a month but less than six months, the diagnosis of schizophreniform disorder is applied. Psychotic symptoms lasting less than a month may be diagnosed as brief psychotic disorder, and various conditions may be classed as psychotic disorder not otherwise specified, while schizoaffective disorder is diagnosed if symptoms of mood disorder are substantially present alongside psychotic symptoms. If the psychotic symptoms are the direct physiological result of a general medical condition or a substance, then the diagnosis is one of a psychosis secondary to that condition. Schizophrenia is not diagnosed if symptoms of pervasive developmental disorder are present unless prominent delusions or hallucinations are also present.

Studies suggest that the prevalence of paraphrenia in the elderly population is around 2-4%.

While paraphrenia can occur in both men and women, it is more common in women, even after the difference has been adjusted for life expectancies. The ratio of women with paraphrenia to men with paraphrenia is anywhere from 3:1 to 45:2

The evidence for the effectiveness of early interventions to prevent psychosis appeared inconclusive. Whilst early intervention in those with a psychotic episode might improve short term outcomes, little benefit was seen from these measures after five years. However, there is evidence that cognitive behavioral therapy (CBT) may reduce the risk of becoming psychotic in those at high risk, and in 2014 the UK National Institute for Health and Care Excellence (NICE) recommended preventive CBT for people at risk of psychosis.

Paranoid schizophrenia is an illness that typically requires lifelong treatment with neuroleptics to allow someone to have a relatively stable and normal lifestyle. In order to be successfully treated, a person with schizophrenia should seek help from family or primary care doctors, psychiatrists, psychotherapists, pharmacists, family members, case workers, psychiatric nurses, or social workers, provided he or she is not unable to do so, due to many people with schizophrenia having the inability to accept their condition. Non-compliance with neuroleptics may also occur if the patient considers the side effects (such as extrapyramidal symptoms) to be more debilitating than the condition itself. The main options that are offered for the treatment of paranoid schizophrenia are the following: neuroleptics, psychotherapy, hospitalization, electroconvulsive therapy, and vocational skills training.

There are many different types of disorders that have similar symptoms to paranoid schizophrenia. There are tests that psychiatrists perform to achieve a correct diagnosis. They include "psychiatric evaluation, in which the doctor or psychiatrist will ask a series of questions about the patient's symptoms, psychiatric history, and family history of mental health problems; medical history and exam, in which the doctor will ask about one's personal and family health history and will also perform a complete physical examination to check for medical issues that could be causing or contributing to the problem; laboratory tests in which the doctor will order simple blood and urine tests can rule out other medical causes of symptoms".

There are side effects associated with antipsychotic medication. Neuroleptics can cause high blood pressure and high cholesterol. Many people who take them exhibit weight gain and have a higher risk of developing diabetes.

According to the Mayo Clinic, it is best to start receiving treatment for paranoid schizophrenia as early as possible and to maintain the treatment throughout life. Continuing treatment will help keep the serious symptoms under control and allow the person to lead a more fulfilling life. This illness is typically unpreventable.

It has a strong hereditary component with a first degree parent or sibling. There is some possibility that there are environmental influences including "prenatal exposure to a viral infection, low oxygen levels during birth (from prolonged labor or premature birth), exposure to a virus during infancy, early parental loss or separation, and verbal, physical or sexual abuse in childhood". Eliminating any of these factors could help reduce an individual's future risk of developing paranoid schizophrenia.

Because of reduced levels of trust, there can be challenges in treating PPD. However, psychotherapy, antidepressants, antipsychotics and anti-anxiety medications can play a role when an individual is receptive to intervention.

In patients suffering from schizophrenia, grandiose and religious delusions are found to be the least susceptible to cognitive behavioral interventions. Cognitive behavioral intervention is a form of psychological therapy, initially used for depression, but currently used for a variety of different mental disorders, in hope of providing relief from distress and disability. During therapy, grandiose delusions were linked to patients' underlying beliefs by using inference chaining. Some examples of interventions performed to improve the patient's state were focus on specific themes, clarification of neologisms, and thought linkage. During thought linkage, the patient is asked repeatedly by the therapist to explain his/her jumps in thought from one subject to a completely different one.

Patients suffering from mental disorders that experience grandiose delusions have been found to have a lower risk of having suicidal thoughts and attempts.

Diagnosis is based on the self-reported experiences of the person followed by a clinical assessment. Psychiatric assessment includes a psychiatric history and some form of mental status examination. Since some medical and psychiatric conditions mimic the symptoms of DPD, clinicians must differentiate between and rule out the following to establish a precise diagnosis: temporal lobe epilepsy, panic disorder, acute stress disorder, schizophrenia, migraine, drug use, brain tumour or lesion. No laboratory test for depersonalization-derealization disorder currently exists.

The diagnosis of depersonalization disorder can be made with the use of the following interviews and scales:

The Structured Clinical Interview for DSM-IV Dissociative Disorders (SCID-D) is widely used, especially in research settings. This interview takes about 30 minutes to 1.5 hours, depending on individual's experiences.

The Dissociative Experiences Scale (DES) is a simple, quick, self-administered questionnaire that has been widely used to measure dissociative symptoms. It has been used in hundreds of dissociative studies, and can detect depersonalization and derealization experiences.

The Dissociative Disorders Interview Schedule (DDIS) is a highly structured interview which makes DSM-IV diagnoses of somatization disorder, borderline personality disorder and major depressive disorder, as well as all the dissociative disorders. It inquires about positive symptoms of schizophrenia, secondary features of dissociative identity disorder, extrasensory experiences, substance abuse and other items relevant to the dissociative disorders. The DDIS can usually be administered in 30–45 minutes.

The Cambridge Depersonalization Scale (CDS) is a method for determining the severity of depersonalization disorder. It has been proven and accepted as a valid tool for the diagnosis of depersonalization disorder in a clinical setting. It is also used in a clinical setting to differentiate minor episodes of depersonalization from actual symptoms of the disorder. Due to the success of the CDS, a group of Japanese researchers underwent the effort to translate the CDS into the J-CDS or the Japanese Cambridge Depersonalization Scale. Through clinical trials the Japanese research team successfully tested their scale and determined its accuracy. One limitation is that the scale does not allow for the differentiation between past and present episodes of depersonalization. It should also be noted that it may be difficult for the individual to describe the duration of a depersonalization episode, and thus the scale may lack accuracy. The project was conducted in the hope that it would stimulate further scientific investigations into depersonalization disorder.

In ICD-10, this disorder is called depersonalization-derealization syndrome F48.1. The diagnostic criteria are as follows:

The diagnosis should not be given in certain specified conditions, for instance when intoxicated by alcohol or drugs, or together with schizophrenia, mood disorders and anxiety disorders.

When the focus is to remedy some injustice by legal action, they are sometimes called "querulous paranoia".

In cases where reporters of stalking behavior have been judged to be making false reports, a majority of them were judged to be delusional.

In the DSM-IV-TR, paranoia is diagnosed in the form of:

- paranoid personality disorder ()

- paranoid schizophrenia (a subtype of schizophrenia) ()

- the persecutory type of delusional disorder, which is also called "querulous paranoia" when the focus is to remedy some injustice by legal action. ()

According to clinical psychologist P. J. McKenna, "As a noun, paranoia denotes a disorder which has been argued in and out of existence, and whose clinical features, course, boundaries, and virtually every other aspect of which is controversial. Employed as an adjective, paranoid has become attached to a diverse set of presentations, from paranoid schizophrenia, through paranoid depression, to paranoid personality—not to mention a motley collection of paranoid 'psychoses', 'reactions', and 'states'—and this is to restrict discussion to functional disorders. Even when abbreviated down to the prefix para-, the term crops up causing trouble as the contentious but stubbornly persistent concept of paraphrenia".

At least 50% of the diagnosed cases of schizophrenia experience delusions of reference and delusions of persecution. Paranoia perceptions and behavior may be part of many mental illnesses, such as depression and dementia, but they are more prevalent in three mental disorders: paranoid schizophrenia, delusional disorder (persecutory type), and paranoid personality disorder.

A 2012 paper suggested that, when compared with experiences today, psychiatric conditions associated with psychotic spectrum symptoms may be possible explanations for some revelatory driven experiences and activities such as those of Abraham, Moses, Jesus, and Saint Paul. However, the paper admits that the study was not aimed to deny supernatural elements, nor was it conclusive on whether their experiences were delusional in part or not at all.

Examples from a 295-subject study in Lithuania showed that the most common religious delusions were being a saint (in women) and being God (in men).

In one study of 193 people who had previously been admitted to hospital and subsequently diagnosed with schizophrenia, 24% were found to have religious delusions.

A 1999 study identified that religious delusions were often present or expressed in persons with forensic committal to a psychiatric unit.

Once it has been positively identified, pharmacotherapy follows. Antipsychotic drugs are the frontrunners in treatment for Fregoli and other DMSs. In addition to antipsychotics, anticonvulsants and antidepressants are also prescribed in some treatment courses. If a Fregoli patient has other psychological disorders, treatment often results in the use of trifluoperazine.

There is limited evidence that caffeine, in high doses or when chronically abused, may induce psychosis in normal individuals and worsen pre-existing psychosis in those diagnosed with schizophrenia.