A new study found the hallucinogenic drug reduces activity in the part of the brain that deals with negative emotions.
Researchers from the University of Basel, Switzerland, measured brain activity in 20 people who took 100 microgrammes of LSD.
Each person looked at photos portraying emotions like anger, joy and fear.
After taking the drug, the participants reacted to fear differently and showed less activity in the amygdala.
This part of the brain is central to processing emotions.
Researchers believe lower amygdala activity is a direct consequence of taking the drug.
Doctor Felix Müller, lead author of the study, said: ‘This “de-frightening” effect could be an important factor for positive therapeutic effects.’
Scientists are hoping the drug could open up new treatments for mental illnesses.
In March, mental health advocate Khaliya Khan called for more research into hallucinogenic drugs.
She said: ‘Mental health for years has been inadequately addressed, partly because the tools we had on offer were hard to scale, and partly because some of the most powerful tools in brain health were stigmatised and turned into scheduled drugs, effectively halting any progress that could be made to prove their efficacy.’