Austen's Emma is one of the great novels of the Western tradition. In this paper the author explores the meaning of Emma's 'ingenious and animating suspicion' that Jane Fairfax seduced her best friend's husband, Mr Dixon. The interpretation that a psychoanalytic understanding makes possible shows how this suspicion represents an oedipal fantasy projected on to Miss Fairfax. Further exploration demonstrates how the fantasy is linked both to Emma's systematic unkindness to Jane Fairfax and to Emma's famous insult to Jane's aunt, Miss Bates. Emma's suspicion projects an oedipal fantasy with its incestuous impulses on to her rival and satisfies an envious aggression at the same time. The author's purpose in this paper is to bring to light through psychoanalytic understanding Austen's dramatisation of the complexity and creativity of the oedipal situation. In addition to the regression in oedipal fantasy, the primary process also functions with a progressive quality that expands and enriches the ego, a double movement described in Keats's 'negative capability', which has been elaborated by Bion. The primal-scene fantasies are often brought alive in the analytic transference. These situations and painful emotions are dramatically portrayed through Austen's genius as vehicles for change. A sudden integration follows a phase of disorganization: 'It darted through her with the speed of an arrow. Mr Knightley must marry no-one but herself'. Emma, who is Austen's 'imaginist', moves from the projected fantasy of the sad love triangle through envy aggression and the narcissistic blows of self-doubt and loss of love to moments of illumination and connection.