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According to the usual view the formation of character is to be traced back partly to inherited dispositions, and partly to the effect of environment, under which a particular significance is ascribed to up-bringing. Psycho-analytical investigation, however, has drawn attention to sources of character-formation which had not previously been sufficiently considered. On the basis of psycho-analytical experience we conclude that those elements of the infantile sexuality which are excluded from participation in the sexual life of the adult individual undergo transformation to some extent into certain character-traits. Freud, as is well known, was the first to show that certain elements of infantile anal erotism suffer this fate. Some part of the anal erotism enters into the final organization of mature sexual life, part of it undergoes sublimation, and the rest finds an outlet in character-formation. These contributions to character from anal sources are to be regarded as normal. They render it possible for the individual to adapt himself to the demands of his environment as regards cleanliness, love of order, and so on. Besides this, however, we have learnt to recognize an 'anal character' in the clinical sense, which is distinguished by an extreme accentuation of certain character-traits; but it is to be noted that excessive addiction to cleanliness, parsimony and similar