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Windholz reports on the work of the Veterans Rehabilitation Clinic, Mount Zion Hospital, San Francisco, California. The therapeutic procedure usually employed is short psychotherapy, supplemented in some cases by group psychotherapy and hypnosis. The author describes extensively a 'hysterical psychosis' frequently observed in veterans, in which the outstanding causative factor is a conflict related to discharge. The clinical symptoms are a dreamy appearance, slight disorientation and depersonalization. Recovery may occur without treatment or upon verbalization of the ambivalence. Windholz then presents a case of a traumatic war neurosis in which a well-functioning 'counterphobic attitude' was broken down by combat stress, resulting in ambivalence and guilt. The infantile basis and the heavy prewar predisposition makes the clinical picture and the psychodynamics transparent. An additional complication in the war neurosis of veterans is the question of compensation and the subsequent ambivalence about it. Group psychotherapy, the reconditioning program and the rôle of the community as situational manipulations are briefly presented.