Levodopa-induced dyskinesias (LIDs) occur in the majority of patients with Parkinson's disease (PD) following years of levodopa treatment. The pathophysiology underlying LIDs in PD is poorly understood, and current treatments generate only minor benefits for the patients. Studies with positron emission tomography (PET) molecular imaging have demonstrated that in advanced PD patients, levodopa administration induces sharp increases in striatal dopamine levels, which correlate with LIDs severity. Fluctuations in striatal dopamine levels could be the result of the attenuated buffering ability in the dopaminergically denervated striatum. Lines of evidence from PET studies indicate that serotonergic terminals could also be responsible for the development of LIDs in PD by aberrantly processing exogenous levodopa and by releasing dopamine in a dysregulated manner from the serotonergic terminals. Additionally, other downstream mechanisms involving glutamatergic, cannabinoid, opioid, cholinergic, adenosinergic, and noradrenergic systems may contribute in the development of LIDs. In this article, we review the findings from preclinical, clinical, and molecular imaging studies, which have contributed to our understanding the pathophysiology of LIDs in PD.