Experts presenting the findings at a forensic science meeting on Tuesday in Melbourne, Australia, said that their study had been instrumental in developing a new approach to reducing risks of attack on the royal family, and UK and European politicians.
They revealed that the approach was to direct "VIP" or star stalkers into psychiatric care.
"We didn't expect such high rates of psychosis. It was very surprising to us," New Scientist magazine quoted Paul Mullen, a forensic psychiatrist at Monash University and the Victorian Institute of Forensic Mental Health, as saying.
During the study, over 20,000 incidences of stalking members of the royal family were scrutinised.
The occurrences included repeated and threatening letter writing, and repeatedly attempted approaches and attacks from 1988 to 2003. The data was contained in files on 8000 people kept by the Metropolitan Police.
"Just under half were people writing letters repeatedly that were usually threatening or inappropriately amorous," said Mullen.
Over the 15-year period, 600 people managed to get close to a member of the royal family, and there were 17 attacks on staff, protection service personal or property, according to him.
Around 3000 of the files covered incidences that were judged to be pranks, or committed by people accidentally or while they were drunk.
The researchers finally examined in detail the files of 250 of the remaining 5000 people judged to be true stalkers.
They found that about 80 per cent of the stalkers had a serious psychotic illness like schizophrenia, delusions and hallucinations.
While the largest group of non-VIP stalkers were rejected lovers who don't usually suffer pychosis, the researchers said that VIP stalkers appeared most like a subset of stalkers called "intimacy seekers".
"Typically a fifth of stalkers have some sort of serious or severe psychotic disorder," says forensic psychologist Rosemary Purcell of the University of Melbourne, who has co-published a book about stalkers with Mullen.
"Some (intimacy seekers) have erotomania, a full-blown delusional disorder, where they believe that the victim is in love with them," says Purcell.
A different study published by Mullen's team earlier this year had also found psychotic illness to be common among people who attacked members of the royal family.