Formed in 1986 by Dr. Sebastian Poe, a worldrenowned expert on superhumans in general and psychic powers in particular, the Parapsychological Studies Institute was allegedly devoted to the study of superhuman phenomena and the training of young supers. It maintained that facade until 1994, when a bungled operation revealed it for what it was: a criminal conspiracy made up of supervillains with mental powers. Its cover blown, PSI went on the lam, becoming a somewhat nomadic supervillain group with a few minor bases scattered throughout the United States. Sebastian Poe was sent to prison and became persona non grata to the organization.
PSI earned a reputation as a powerful and deadly, if at times somewhat limited, supervillain team over the next decade. Its most successful scheme was the creation of Mind, Inc., a self-help group based in Millennium City. In reality Mind, Inc. simply allowed PSI to accumulate profit, power, influence, and potential recruits. But the whole thing unravelled in 2005 when PSI’s core leadership — the telepath and telekinetic Psimon, his sometime companion Medusa (Sebastian Poe’s ex-wife), his other sometime companion Mind Slayer, and their chief lackeys — came under two-pronged attack. From the outside they were attacked by Kevin Poe, son of Sebastian Poe and leader of Millennium City’s infamous New Purple Gang. Poe hungered for revenge against the people who “betrayed” his father and control of the organization itself. From within, PSI member Lancer and others loyal to her attempted to take over PSI to turn it into an “army” to use against the “anti-metahuman forces” she perceived were rising to power on Earth (as they had in her home dimension).
The resulting three-sided conflict ripped PSI apart, resulting in the deaths of several members. Mind, Inc. was exposed, and several survivors of the fighting (including Psimon) were captured by the authorities. The rest of the members scattered, often becoming freelance supercriminals or going to work for master villains.