The systematic terms of metapsychology expressed in Freud's theory of oedipal guilt have overshadowed his emergent ideas about preoedipal internal objects and preoedipal guilt. This article reconstructs the latent theory of preoedipal guilt in his notions of narcissism, fantasy, aggression, and ambivalence. Special attention is devoted to his discussions of the narcissistic function of creating fantasized objects through identificatory processes, in order to compensate for loss or disturbances in object relating. Although Freud put forward the notion of oedipal guilt as a derivative of secondary mental processes, he intuitively grasped that guilt emerges from the conflict-bound sphere of preoedipal relations. “A Child Is Being Beaten” is used as an illustration, as are clinical examples drawn from the author's practice.