The article provides with psychoanalysis of the story titled Traumnovelle (Rhapsody: A Dream Novel, also known as Dream Story), written by Arthur Schnitzler, representative of the Viennese modernist style, that decodes intricate forms of mental life from unconscious instincts, libido. The reader is exposed to the characters’ affection, that of the therapist Fridolin and his wife Albertina, who play each other up with immodest confessions about their erotic affection. The article uncovers the action mode of the story, which is on the verge between dream and reality, consciousness and unconsciousness, peculiarities of feelings exposure through the characters’ imagination, structurally similar to a dream, is reviewed as well. The article examines the motivational structure of Albertina’s behavior, determined by “primary affection”, activity of her psychics, regulated by “satisfaction principle”, and that of Fridolin, based on “reality principle”, where functional activity is coherent with human needs and external reality conditions. The article investigates the motive of a mask as a symbol of transformation, acquisition of anonymity by losing individuality (Fridolin’s participation in a sado-masochistic orgy at villa of secret society) and as an opposition to the husband real-life adventure – Albertina’s dream, revealing frustration and pleasure from a married woman’s revenge for the imposed role of serving her husband. It is concluded that the art, as well as a dream, makes it possible to get released for some period of time from a social role and a consciousness censorship.