BACKGROUND This study assesses the utilization of antipsychotic therapeutic drug monitoring (TDM) and describes characteristics of appropriate and inappropriate TDM at a state psychiatric hospital. METHODS A retrospective, descriptive review was conducted for antipsychotic TDM completed between December 1, 2009, and June 30, 2011, at a 65-bed adult inpatient extended-care and forensic state psychiatric hospital. RESULTS One hundred thirty-three (n = 133) antipsychotic serum levels were collected from 44 patients during the study period. Sixty-nine percent (69%) of the TDM were deemed inappropriate, 28% were appropriate, and 3% could not be designated appropriate or inappropriate owing to the lack of information regarding steady-state conditions. The primary reason for inappropriate TDM was lack of documentation with regard to the indication for TDM (n = 79, 59.3%), the intervention following laboratory analysis (n = 88, 66%), or both. Appropriate TDM was associated with a lower laboratory cost for antipsychotic serum level ($48.98 ± $53.49 versus $72.06 ± $51.02, P < .05), lower daily cost of scheduled psychiatric medications ($17.72 ± $23.03 versus $32.26 ± $31.05, P < .05), lower daily cost of total medications ($19.28 ± $24.91 versus $33.82 ± $31.03, P < .05), fewer scheduled psychiatric medications (2.95 ± 1.90 versus 4.04 ± 2.19, P < .01), and fewer total scheduled medications (5.95 ± 3.60 versus 7.60 ± 3.29, P < .05). Inappropriate TDM led to approximately $6,753 in avoidable laboratory costs over a 20-month period. CONCLUSIONS Therapeutic drug monitoring is a complex process with many points at which errors may occur. The majority of antipsychotic levels at this state psychiatric hospital were not documented in a way that was clinically useful. Inappropriate TDM was associated with increased laboratory and medication costs.