Personalization in psychiatry, among many other aspects, also concerns precise diagnosis, describing the patient’s symptoms exactly. Establishing an accurate diagnosis is an important aspect contributing to the implementation of appropriate therapeutic procedures. Currently, some psychiatric diagnoses are being denied their validity. Paraphrenia (PRF) is one of these mental illnesses whose nosological position is unclear. For over a century, PRF has attempted to define an autonomous clinical domain close to schizophrenia and/or the psychoses of old age. This article describes the origins and development of the concept of PRF. The development of other diagnostic terms that are closely related to PRF is discussed, including chronic hallucinatory psychosis, late-onset paraphrenia, and late-onset schizophrenia. The position of PRF in psychiatric classifications is also discussed. Opinions for and against the distinct diagnosis of PRF in psychiatry are presented. The clinical presentation, treatment, and prognosis of PRF are described.