The Neo-Freudian perspective expands on Freud’s original beliefs, emphasizing social and cultural relationships and childhood experiences more than just unconscious and sexual drives. Despite the lack of childhood experiences shown in this movie, the audience could infer and pick up on some social and cultural relationships. Particularly, Alfred Adler’s idea of overcompensation and the inferiority complex could be seen in Diane. Feeling inferior to Camilia regarding both her career and relationships, she fabricates this fantasy world where she begins to overcompensate for her talent and likability, eventually driving her to hire a hit man in a desperate attempt to regain control of herself. Diane’s archetypes, as described by Carl Jung, could also be seen in the film. Her constructive and destructive tendencies, known as the shadow, come out in different scenes of the movie, such as the homeless creature behind Winkie’s as an embodiment of the disturbing and evilness she has within herself. Interestingly, Diane’s constant repression and ignorance of her shadow, leading to her suicide, correlates perfectly with Jung’s warning that ignoring the shadow will lead to self-destruction.

Stuck in Maslow’s lower stages (tiers) of the hierarchy of needs, Diane never achieves the self-actualization stage, focusing on the desire for love rather than self-fulfillment or personal growth. This represents her low self-esteem and sense of self-concept are all based on external validation rather than her personal growth. Diane also lacks conditional positive regard, only feeling valued when she meets the expectations of others, rather than feeling a sense of acceptance regardless of where she is in life. One of the largest elements of this role is related to this theory of personality, more specifically Carl Rogers's ideal self vs. real self. While Diane is a failed actress consumed by jealousy and lack of fulfillment (real self), Betty is the embodiment of the successful, beloved actress who has everything going for her (ideal self). These two contrasting individuals, yet embodied by the same person, represent how Diane’s sense of self continuously breaks apart, eventually leading to her demise due to the gap in the bridge to connect her ideal vs real self.

Although no direct information is given to the audience about the biological explanation for Diane’s behavior, we can consider and use our knowledge of the brain to come up with some conclusions. For example, her depression and paranoia could be correlated to an imbalance (low) amount of neurotransmitters, particularly serotonin and dopamine. These two neurotransmitters are often associated with mood regulation, and research has been done to show how low serotonin and dopamine could affect the mind negatively. Additionally, issues with Diane’s amygdala could also explain her behavior, as the amygdala is responsible for the regulation of fears and emotions in the brain. While these factors are not directly said in the film, it is important to note possible biological factors that could’ve affected Diane and her behaviors.

Looking at Diane’s personality and actions on an evolutionary level could suggest that it relates to the human's innate need for social interaction and connection, and Diane’s disconnection from both needs. Through her loss of both love and career from the social competition, Diane begins to spiral out of control, believing that she has been replaced and is no longer needed in Camila's life. As the mate selection theory suggests, women seek a mate who offers stability, and Diane’s failure to find someone stable enough to stay with her leads her to become aggressive and eventually think she is worthless.

Throughout the film, Diane exhibits an external locus of control, justifying and believing that her failures in Hollywood and her rejection by Camilia were due to external factors out of her control. This could be seen in scenes including the “boss of Hollywood” as that one man and his organization determines if you will be selected or not in Hollywood. It could also be seen in the scene where Betty auditions for a spot in a movie, showcasing how amazing a performance she had, but was cut short due to the director being oblivious and childish. These scenarios that Diane dreamed about show how she believed all her failures were due to external factors rather than internal factors and her actions. All of these failures lead her to learned helplessness, a state where she is powerless and can not change any of the cards “she was dealt.” Diane is also a victim of the false consensus bias, believing that others view her as a failure and worthless, just like she views herself. This consensus bias, mixed with the other factors, leads her to become trapped in a cycle of self-destruction and isolation, eventually leading her to kill herself.

Finally, Diane’s actions and experiences are shaped by society and social interactions, particularly the unforgiving nature of Hollywood. Hollywood, focused solely on success and beauty, determining your worth, Diane becomes blind to who she is and how amazing she truly is. Hollywood’s individualistic nature, rather than collectivist, causes Diane to isolate herself, believing her self-worth is dependent on what you achieves rather than support from the people around you.

Overall, David Lynch’s Mulholland Drive offers some of the most vibrant and natural showcases of psychological issues within an individual, illustrating the magnitude of cinema and how a film enthusiast can learn simply by watching one of their favorite movies.