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Following Balint's view that the psychoanalytic community was traumatised by the Freud-Ferenczi controversy, the author considers whether the roots of the confrontation between drive-based and object-relations theories might lie in a failure to examine this disagreement in sufficient depth. Increasing interest, as reflected in the literature, is now focusing on Ferenczi's ideas after many years of neglect due in part to Jones's ‘official’ account of the ‘mental deterioration' of his last years. Adducing late works by both Freud and Ferenczi, the author shows that the latter amplified Freud's ideas rather than breaking with them. To Freud, who had always been concerned to stress the role of the drives in psychopathology, Ferenczi's emphasis on external trauma smacked of his own, rejected, early seduction theory, but trauma does feature prominently in Freud's discussion of interminable analyses, as does Ferenczi himself. In the author's view, a careful reading of the two men's late works reveals a conception of trauma as lying in an intersubjective space as a consequence of the meeting of drive and object. Present-day conceptions of transgenerational trauma are shown to be already present in Ferenczi. The problems in the relationship between Freud and Ferenczi and their theoretical disagreements are also considered in the light of the latter's inadequate analysis with Freud.