Freud introduced the concept of psychical reality as a consequence of abandoning the theory of seduction, and although this meant a turning point in his theoretical thinking he never defined the concept concisely and systematically. Thus it is possible to delineate at least two meanings of psychical reality that run through Freud´s writings as well as the writings of contemporary analysts. On the one hand psychical reality encompasses the whole field of subjective experiences. On the other, it is understood more narrowly as a transformation of experiences in the unconscious.

Substituting the idea of different meanings ascribed to Freud´s concept this article proposes to differentiate between levels in the psyche with the main focus on the unconscious level of the dream and of phantasy and the real unconscious. Starting from the most superficial level of subjective reality the text moves to that of fantasy formation illustrated by primarily Freud´s text on `A child is being beaten´. Adding Laplanche´s translational model the article ends up at the deepest level represented by the late Lacan and his concept of the real Unconscious.

The paper concludes that the term real points to something exceeding symbolization and the imaginary—thus escaping comprehension—and yet is absolutely indispensable to the organization of unconscious processes.