EEG testing can diagnose patients with medial temporal lobe epilepsy. Epileptiform abnormalities including spikes and sharp waves in the medial temporal lobe of the brain can diagnose this condition, which can in turn be the cause of an epileptic patient's micropsia.

The Amsler grid test can be used to diagnose macular degeneration. For this test, patients are asked to look at a grid, and distortions or blank spots in the patient's central field of vision can be detected. A positive diagnosis of macular degeneration may account for a patient's micropsia.

A controlled size comparison task can be employed to evaluate objectively whether a person is experiencing hemimicropsia. For each trial, a pair of horizontally aligned circles is presented on a computer screen, and the person being tested is asked to decide which circle is larger. After a set of trials, the overall pattern of responses should display a normal distance effect where the more similar the two circles, the higher the number of errors. This test is able to effectively diagnose micropsia and confirm which hemisphere is being distorted.

Due to the large range of causes that lead to micropsia, diagnosis varies among cases. Computed tomography (CT) and magnetic resonance imaging (MRI) may find lesions and hypodense areas in the temporal and occipital lobes. MRI and CT techniques are able to rule out lesions as the cause for micropsia, but are not sufficient to diagnose the most common causes.

Treatment varies for micropsia due to the large number of different causes for the condition.

Treatments involving the occlusion of one eye and the use of a prism fitted over an eyeglass lens have both been shown to provide relief from micropsia.

Micropsia that is induced by macular degeneration can be treated in several ways. A study called AREDS (age-related eye disease study) determined that taking dietary supplements containing high-dose antioxidants and zinc produced significant benefits with regard to disease progression. This study was the first ever to prove that dietary supplements can alter the natural progression and complications of a disease state. Laser treatments also look promising but are still in clinical stages.

Palinopsia necessitates a full ophthalmologic and neurologic history and physical exam. There are no clear guidelines on the work-up for illusory palinopsia, but it is not unreasonable to order automated visual field testing and neuroimaging since migraine aura can sometimes mimic seizures or cortical lesions. However, in a young patient without risk factors or other worrisome symptoms or signs (vasculopathy, history of cancer, etc.), neuroimaging for illusory palinopsia is low-yield but may grant the patient peace of mind.

The physical exam and work-up are usually non-contributory in illusory palinopsia. Diagnosing the etiology of illusory palinopsia is often based on the clinical history. Palinopsia is attributed to a prescription drug if symptoms begin after drug initiation or dose increase. Palinopsia is attributed to head trauma if symptoms begin shortly after the incident. Continuous illusory palinopsia in a migraineur is usually from persistent visual aura. HPPD can occur any time after hallucinogen ingestion and is a diagnosis of exclusion in patients with previous hallucinogen use. Migraines and HPPD are probably the most common causes of palinopsia. Idiopathic palinopsia may be analogous to the cerebral state in persistent visual aura with non-migraine headache or persistent visual aura without headache.

Due to the subjective nature of the symptoms and the lack of organic findings, clinicians may be dismissive of illusory palinopsia, sometimes causing the patient distress. There is considerable evidence in the literature confirming the symptom legitimacy, so validating the patient’s symptoms can help ease anxiety. Unidirectional visual trails or illusory symptoms confined to part of a visual field suggest cortical pathology and necessitate further work-up.

Research needs to be performed on the efficacy of the various pharmaceuticals for treating illusory palinopsia. It is unclear if the symptoms' natural history and treatment are influenced by the cause. It is also not clear if there is treatment efficacy overlap for illusory palinopsia and the other co-existing diffuse persistent illusory phenomenon such as visual snow, oscillopsia, dysmetropsia, and halos.

Future advancements in fMRI could potentially further our understanding of hallucinatory palinopsia and visual memory. Increased accuracy in fMRI might also allow for the observation of subtle metabolic or perfusional changes in illusory palinopsia, without the use of ionizing radiation present in CT scans and radioactive isotopes. Studying the psychophysics of light and motion perception could advance our understanding of illusory palinopsia, and vice versa. For example, incorporating patients with visual trailing into motion perception studies could advance our understanding of the mechanisms of visual stability and motion suppression during eye movements (e.g. saccadic suppression).

There is limited data on treating the visual disturbances associated with HPPD, persistent visual aura, or post-head trauma visual disturbances, and pharmaceutical treatment is empirically-based. It is not clear if the etiology or type of illusory symptom influences treatment efficacy. Since the symptoms are usually benign, treatment is based on the patient’s zeal and willingness to try many different drugs. There are cases which report successful treatment with clonidine, clonazepam, lamotrigine, nimodipine, topiramate, verapamil, divalproex sodium, gabapentin, furosemide, and acetazolamide, as these drugs have mechanisms that decrease neuronal excitability. However, other patients report treatment failure from the same drugs. Based on the available evidence and side-effect profile, clonidine might be an attractive treatment option. Many patients report improvement from sunglasses. FL-41 tinted lenses may provide additional relief, as they have shown some efficacy in providing relief to visually-sensitive migraineurs.

People with palinopsia frequently report other visual illusions and hallucinations such as photopsias, dysmetropsia i.e. Alice in Wonderland syndrome (micropsia, macropsia, teleopsia, and pelopsia), visual snow, oscillopsia, entoptic phenomena, and cerebral polyopia.

Whatever the cause, the bodily related distortions can recur several times a day and may take some time to abate. Understandably, the person can become alarmed, frightened, and panic-stricken throughout the course of the hallucinations—maybe even hurt themselves or others around them. The symptoms of the syndrome themselves are not harmful and are likely to disappear with time.

Teleopsia is a vision perception disorder, in which objects appear much farther away than they are. Teleopsia is a disorder associated with dysmetropsia.

Alice in Wonderland syndrome is a disturbance of perception rather than a specific physiological change to the body's systems. The diagnosis can be presumed when other causes have been ruled out and if the patient presents symptoms along with migraines and complains of onset during the day (although it can also occur at night).

Another symptom of Alice in Wonderland syndrome is sound distortion, such as every little movement making a clattering sound.