The emergence of a collective identity, a complex social and psychological process, may be linked to a specific place and a particular urban layout. Architecture demarcates interior and exterior spaces that not only frame our relationships but can also generate a mirror image of the internal world. The authors examine relevant contributions from the sparse psychoanalytic literature on this subject, to support their hypothesis that changes to a city's landscape, design, or architecture, when wholeheartedly embraced by its citizens, can serve to forge a new collective identity that helps to deal with absence, pain, and loss. They present the city of Bilbao, Spain, as a case study. This once thriving industrial city had collapsed into economic ruin, rife with social conflict, but since the 1990s, in an urban renewal, has emerged as a unique tourist destination. It has become a modern art and cultural center, symbolized by its most famous piece of contemporary architecture.