It is widely recognized that medical researchers of the early Romantic period, in close collaboration with idealist philosophers, set the stage for the rise of psychoanalysis by breaking with the eighteenth-century conception of mental illness as a criminal failure of the human to rise above its animal nature. Insanity was re-conceived, not as a crime, but as a sickness of the self-developing soul. According to Schelling, whose involvement with medicine at this time was significant enough to warrant the granting of an honorary doctorate in the field from the University of Landshut, we all have “madness” (Wahnsinn) in us. Should it remain latent, it serves an essential role as the wellspring of human creativity and spiritual vitality. Insanity occurs when that which ought to remain in potency steps forth into actuality. The madness in potency in the “dark ground” of human consciousness is the root of both divine inspiration and the sicknesses of the soul. It cannot be extirpated and needs to be regulated, not repressed. Schelling’s point anticipates one that would be made by Freud, Jung, and Lacan, with varying emphases, a century later: the mentally ill are revealing something basic to the structure of the normal human psyche.