In 1926, Freud famously conjectured that the human ego defense of repression against an internal instinctual threat evolved from the animal motor defense of flight from an external predatory threat. Studies over the past 50 years mainly in rodents have investigated the neurobiology of the fight-or-flight reflex to external threats, which activates the emergency alarm system in the dorsal periaqueductal gray (dPAG), the malfunction of which appears likely in panic and post-traumatic stress disorders, but perhaps also in some "non-emergent" conditions like social anxiety and "hysterical" conversion disorder. Computational neuroscience studies in mice by Reis and colleagues have revealed unprecedented insights into the dPAG-related neural mechanisms underlying these evolutionarily honed emergency vertebrate defensive functions (e.g., explore, risk assessment, escape, freeze). A psychoanalytic interpretation of the Reis studies demonstrates that Freud's 1926 conjecture is confirmed, and that internal instinctual threats alone can also set off the dPAG emergency alarm system, which is regulated by 5-HT1A and CRF-1 receptors. Consistent with current psychoanalytic and neurobiologic theories of panic, several other of the primitive components of the dPAG alarm system may also have relevance for understanding of the unconscious determinants of impaired object relationships (e.g., avoidance distance). These dPAG findings reveal (1) a process of "evolution in situ," whereby a more sophisticated dPAG ego defense is seen evolving out of a more primitive dPAG motor defense, (2) a dPAG location for the phylogenetically ancient kernel of Freud's Ego and Id, and (3) a Conscious Id theory that has been conclusively invalidated.