In this paper, I focus on the nature and functions of the interpretive process in psychotherapy with adolescents with severe personality disorder. I will describe how the interpretive process in transference focused psychotherapy for adolescents provides affective containment and symbolic management of psychological conflict along with a shift toward the predominance of repression-based over primitive defenses. This process leads to a progressive resolution of identity diffusion. I will give illustrations of different phases of the interpretive process.