The possibility that diagnostic formulations can impede rather than promote the goals of psychotherapy is discussed in the context of the intersubjective nature of the therapeutic relationship. Psychoanalytic literature regarding diagnosis and analyzability is reviewed to show how assumptions about the permanence of pathological structures or defects in patients' personalities have shaped and limited clinicians' sensibilities. A clinical illustration shows how attitudes implicit in diagnostic formulations can inhibit the development of a transference bond and the resumption of a thwarted developmental process. Concluding comments relate distancing reactions to empathic limitations of the therapist, which may be reflected in diagnoses, in decisions regarding technique, and in conceptualizations of transference and treatment.