Therapeutic relationships are the foundation to all healthcare. Dr. Hildegard E. Peplau, the mother of modern psychiatric-mental health nursing practice, developed the ground-breaking theory of interpersonal relations in nursing during the 1940s; her theory continues to be essential to contemporary healthcare practice. Interpersonal relations in nursing proposes how nurses and clients interact with one another to form and maintain the therapeutic relationship. This chapter provides a historical context to the origins of Peplau’s theory, its assumptions, and major concepts. The theory is conceptualized from the perspective of two broad foci: the interpersonal focus, which attends to the external interpersonal processes between the client and nurse, including the therapeutic relationship, communication, patterns of how one interacts with the world, and the nurse role; and the intrapersonal focus, which are factors internal to the client and nurse, such as anxiety, learning, thinking, and competencies. Clinical examples are provided to illustrate the application of Peplau’s theory to practice.