Henry Fuseli was a forerunner of the artistic Romantic era; many of his works reveal his love for the grotesque, the sublime, and the fantastic. He is best remembered for The Nightmare (1781) and his fascination with the realm of the dream-world. This picture secured his reputation when it was shown at the Royal Academy in 1782: A woman in the throes of a violently erotic dream where she is crushed by the weight of the incubus, in the presence of a horse. Freud considered the Nightmare (or night-terror) to be a hallucination and that the Nightmare belonged to the group of anxiety dreams. However, in the Interpretation of Dreams, he stated that he lacked sufficient observational material to confirm his theory of the source of night-terrors and their accompanying hallucinations, and therefore did not proceed to investigate the Nightmare. This thesis presents a psychoanalytic exploration of the experience of the Nightmare as represented by Fuseli’s The Nightmare. Based on Freud's inconclusive theory of the Nightmare and in the light of the theories of Ernest Jones and Jacques Lacan, the fundamental relation between anxiety and the Nightmare are explored. The superstition and mythology surrounding the figures in The Nightmare (1781) are explored in both in the light of The Uncanny and Ernest Jones' book On the Nightmare with regard to the characteristic appearance of grotesque and terrifying figures. The painting provides an opening into the psychoanalytic exploration of anxiety and its relation to dreams, specifically to the Nightmare. The generation of anxiety is an intricate part of the experience of the Nightmare, each of the typical features illustrates this occurrence. Using the theories of Freud and Lacan, it emerges that anxiety experienced as part of the Nightmare is that as a signal of a danger-situation where the dreamer wakes in a state similar to that of a panic attack. The focus of this thesis is specifically castration anxiety and its relation to the Nightmare.