Elevated dopamine transmission in psychosis is assumed to unbalance striatal output through D1- and D2-receptor-expressing spiny-projection neurons (SPNs). Antipsychotic drugs are thought to re-balance this output by blocking D2 receptors (D2Rs). In this study, we found that amphetamine-driven dopamine release unbalanced D1-SPN and D2-SPN Ca2+ activity in mice, but that antipsychotic efficacy was associated with the reversal of abnormal D1-SPN, rather than D2-SPN, dynamics, even for drugs that are D2R selective or lacking any dopamine receptor affinity. By contrast, a clinically ineffective drug normalized D2-SPN dynamics but exacerbated D1-SPN dynamics under hyperdopaminergic conditions. Consistent with antipsychotic effect, selective D1-SPN inhibition attenuated amphetamine-driven changes in locomotion, sensorimotor gating and hallucination-like perception. Notably, antipsychotic efficacy correlated with the selective inhibition of D1-SPNs only under hyperdopaminergic conditions—a dopamine-state-dependence exhibited by D1R partial agonism but not non-antipsychotic D1R antagonists. Our findings provide new insights into antipsychotic drug mechanism and reveal an important role for D1-SPN modulation.