This paper looks at the unconscious processes that are at work between a patient and staff-group within a psychiatric ward. The author applies Kleinian theory to conceptualise the emergence of an unconscious belief system and considers how this system may help or hinder the staff-group's task of treating mental illness. Applying case material taken from qualitative research the author explores the mechanisms that can lead to a distortion of external reality and group / patient identity. The author observes deep anxieties that are generated through the relationship between patient and staff-group and traces these anxieties back to unconscious phantasies of early Oedipal conflict. The author shows how these anxieties impact on the ward dynamics, affecting the group task, and the patient's fragile internal world. Having established the unconscious processes at work, the author considers how these anxieties may be alleviated.