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The author examines Freud's theory that in neurosis the ego in virtue of its allegiance to reality suppresses a part of the id, whereas in psychosis the ego in the service of the id withdraws itself from a part of reality. He points out that religious people also lose a part of reality, e.g. in turning from woman, and that with their masochistic orientation to God they give up their active—masculine—desires just as did Schreber. Reality is not only something that restrains, but something that gives opportunity for the satisfaction of our desires; the sense of reality develops in no little measure from the satisfying nature of the outer world. Neurotics lose touch with the agreeable part of reality because of their submission to the disagreeable part (castration threats). Does the ego in psychosis ignore reality in the service of the id as Freud suggests? Is the antithesis turning from reality and turning from the id useful? He re-examines the Schreber and Wolf-man cases with this in view and finds the passive-masochistic attitude far stronger than with neurotics; for example, the megalomania coincides with the passive wishes, and in the Wolf-man