Deep into the game, Sebastian realizes that his guilt has no rational ground. He didn't fail Lily at the house fire; Mobius thwarted his investigation as a "force of nature;" Myra left to protect (rather than spite) him; and Joseph never died. His self-blame is exposed as a starting assumption that crafts his self-image.

Sebastian's epiphany occurs during a dream conversation with Myra. Sebastian accepts himself as an individual actor in an uncontrollable world, and he forgives himself for his perceived failures. However, no epiphany overrides years of practiced self-destruction. He needs to learn not to manufacture sins to forgive.

The third part of The Evil Within 2's archetype, praxis, now unfolds. Sebastian encounters a trial exactly like those he previously failed. After briefly defaulting to old habits, he turns his insight into new strength of character.

Sebastian must deal with Torres's death. Theodore tricks Sebastian into shooting her, but the wound is superficial. She then rescues Sebastian, unconscious, as penance for kidnapping Lily years ago. A horde of enemies attack before the two reach a safe room. Torres, after delivering Sebastian to safety, dies from her wounds.

Sebastian learns about Torres's death after waking from his dream of self-forgiveness. Despite his epiphany, he defaults to the same self-blame that revised his memory of the house fire. He ignores that he was tricked into shooting her, and he edits out the enemy ambush. He also filters out Torres's agency when he does not investigate her reasons for acting, just as he filtered out Myra's.

Hoffman, the team's psychologist, interrupts his self-incrimination. Speaking as a counselor, she gives Sebastian a balanced assessment of factors beyond his control. He follows her lead and moves past his ego-centrism. When he accepts both context and others' agency, he can focus on Theodore as the true culprit.

The archetype reaches closure. After laboring under a delusion, Sebastian reached a moment of epiphany. Later events challenged him to refuse his old delusions in favor of his new insight. After wavering, he passed the trial with new strength.