Psoriasis (PsO) and atopic dermatitis (AD) are chronic, inflammatory skin diseases with distinct, yet occasionally overlapping, immunological profiles. PsO is characterized by T helper (Th) 1/Th17 immune pathways, while AD predominantly involves Th2 responses. However, a subset of patients exhibit features of both conditions, presenting a diagnostic and therapeutic challenge. This review aims to comprehensively assess the pathogenesis, clinical presentation, and therapeutic considerations of the PsO-AD overlap phenotype. This unique clinical entity is characterized by mixed Th17/Th2 immune responses, including elevated levels of interleukin (IL)-17A, IL-23, IL-4, and IL-13, complicating diagnosis and treatment strategies. Recent insights into the genetic, immunological, and environmental contributors to this phenotype, alongside emerging biomarker-guided therapies, offer potential for more precise management.