The basic proposal made in this paper is that Latin American psychiatry possesses characteristics which make it fundamentally different to the psychiatric concepts and practice in other parts of the world. One of these essential features is its multiracial character which acts an integrative process allowing the reception, examination, critique, and reasonable and rational application of contributions from different sources, theoretical doctrines, and schools of thought. The final result is thus a unique brand of psychiatry. This paper metaphorically situates this process in parallel with the history of José María Arguedas, a Peruvian anthropologist whose life, work, death, and legacy present significant similarities to the development and current status of Latin American psychiatry. The multiracial character of Latin American psychiatry is also reflected in its contributions in areas such as diagnosis, epidemiology, treatment, research, and original ideas which strengthen the pluralism, syncretism, and relevance of a discipline which, for a variety of historical, cultural and professional reasons, has to demonstrate a solid, identifiable and respectable identity. The challenges which this process faces in the new century are also examined.