The paper begins by reviewing Freud's case history of Dora and emphasizing her involvement in and overstimulation by her parents' sexual behavior. This markedly interfered with her ability to desexualize her relationship with them. As a result she was unable to develop the illusion of parental celibacy, which I postulate is an important and necessary defensive stage in normal adolescence. This illusion facilitates the desexualization of the adolescent's relationship to the parents and so contributes to separation from them and the seeking of non-incestuous sexual outlets. The disruption of this illusion of parental celibacy by parental sex education, or by the complications of parental divorce may contribute significantly to the development of adolescent psychopathology. Clinical vignettes are presented.