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This paper presents a theory of the persecutory delusions which occur in the schizophrenias. Attention is turned to the masturbatory fantasies and dreams of neurotic patients undergoing psychoanalytic treatment. The similarity of the contents of these fantasies to the delusional contents suggests that the latter are in the nature of masturbatory fantasies. Their conversion into delusions results from psychical dissolution. The 'defence' activity is secondary to this.