Plant-derived alkaloids represent a pharmacologically diverse class of nitrogen-containing natural products that have profoundly shaped modern neuropharmacology and central nervous system (CNS) drug discovery. These structurally complex secondary metabolites interact with a wide array of neuronal targets, including neurotransmitter receptors, ion channels, transporters, and intracellular signaling pathways, thereby modulating synaptic transmission, neuroplasticity, and neuroprotection. Alkaloids such as morphine, galantamine, vincristine, and caffeine have achieved clinical validation as approved neurotherapeutics, while numerous others are progressing through preclinical and clinical development pipelines for neurological and neuropsychiatric disorders including pain, neurodegenerative diseases, epilepsy, and mood disorders. This review examines the neuropharmacological profiles of major alkaloid classes—including indole, isoquinoline, tropane, pyrrolidine, quinoline, and purine derivatives—with emphasis on their molecular mechanisms of action, structure-activity relationships, and CNS target selectivity. We discuss critical translational considerations including blood-brain barrier permeability, pharmacokinetic optimization, safety profiles, and addiction liability. Furthermore, we explore the role of alkaloids as privileged scaffolds for semi-synthetic analog development and rational drug design. Despite their therapeutic promise, challenges remain in optimizing CNS drug-likeness, minimizing off-target effects, and navigating complex regulatory pathways. Emerging strategies integrating computational modeling, target-based screening, and precision medicine approaches are expected to accelerate the translation of alkaloid-based lead compounds into next-generation neurotherapeutics for unmet clinical needs in neurology and psychiatry.