Sexual boundary violations (SBVs) are devastating events within a psychoanalytic institute. SBVs are harmful not only to the patient/candidate upon whom the violation was committed but also to other patients of the violating analyst, and to the psychoanalytic community as a whole. This article considers the interpersonal and intrapsychic processes that lead to SBVs and their ripple effects. The author argues that SBVs signal a collapse of the third in the analytic dyad and in an institute as a whole. The author uses a case example to illustrate the utility of viewing ripple effects from SBVs as a consequence of a collapse of the third.