Many doctors have experienced their internship as a traumatic initiation into the medical profession. Rarely questioned, the process has resulted in a traditional cycle of distressed and unhappy interns. This article is an attempt to understand and clarify the institutional dynamics which are responsible for creating and maintaining these adverse patterns of behaviour. It concentrates on the interaction between the intern's inner phantasy world, the impact of the external hospital situation and the social defences which the hospital develops to protect its staff against the pain and anxiety inherent in their work. These collective social defence mechanisms often fail to protect the intern from intense anxiety and instead contribute to the hospital's increasing rigidity and resistance to change.