The Tower of Babel narrative reveals far more than an origin story for human languages - it chronicles a pivotal transformation in human consciousness. Through the lens of depth psychology, the biblical account emerges as a sophisticated metaphor for humanity's psychological evolution from primitive group-mind to differentiated individual awareness. Psychoanalytic interpretation of biblical and midrashic texts, drawing on Freud's group psychology theory and object relations work by Mahler and Winnicott, illuminates how the "confounding of language" represents the necessary imposition of psychological boundaries enabling mature self-other relationships. The pre-Babel generation exhibited classic characteristics of group psychology: loss of individual identity, omnipotent thinking, and primary process language that prevented genuine communication between separate individuals. Divine intervention at Babel catalyzed what Mahler terms "separation-individuation," forcing humanity to progress from symbiotic merger to rational discourse requiring negotiation between distinct persons. This developmental leap proved essential for the subsequent covenant relationship with Abraham, representing humanity's newfound capacity to maintain both authentic interpersonal boundaries and collective identity.