Recent technological advances in intracranial brain stimulation have enhanced the potential of neuromodulation for addressing neuropsychiatric disorders. We present a review of the methodology and the preliminary outcomes of the pioneering studies exploring intracranial biomarker detection and closed-loop neuromodulation to modulate high-symptom severity states in neuropsychiatric disorders. We searched PubMed, Scopus, Web of Science, Embase, and PsycINFO/PsycNet, followed by the reference and citation lists of retrieved articles. This search strategy yielded a total of 583 articles, of which 5 articles met the inclusion criteria, focusing on depression, obsessive-compulsive disorder, post-traumatic stress disorder, and binge eating disorder. We discuss the methodology of biomarker identification, the biomarkers identified, and the preliminary treatment outcomes for closed-loop neuromodulation. Successful biomarker identification hinges on investigating across various setting. Targeted neuromodulation, either directed at the biomarker or within its associated neural network, offers a promising treatment approach. Future research should seek to understand the mechanisms underlying the effects of neuromodulation as well as the long-term viability of these treatment effects across different neuropsychiatric conditions.