This critical analysis of both the foundation and the organisation of the psychiatric institution, and of the way in which staff function and patients are treated, shows that unconscious mechanisms of the human psyche rule the institution in the same destructive manner as they do in the outside world. The institution is not a rational construction nor is it run by special driving forces, but rather is a place where the repetition of psychic tragedies and the drama of Eros and Thanatos prevail. Further, it functions as an overall mothering and securing structure where, when things go wrong, the fatherly repressive side takes the upper hand. And what of the rights of the patient? What kind of humanity drives the work within an institution? The author argues that the psychoanalyst plays a permanent subversive role within the institution, in order to make new effects possible, provided that the specific ethics of the psychoanalytic discourse are taken into account.