The role of laughter during psychotherapy is poorly understood. This study examined 10 unique sessions of psychodynamic psychotherapy with digital videotape and simultaneous measures of skin conductivity (SC) from patients and therapists. Independent observers coded laugh episodes using published criteria. Observers identified 167 laugh responses. Of the 119 patient laughs, 91 (76.5%) were patient as speaker, compared with 28 (23.4%) as nonspeaker audience. In contrast, of the 48 therapist laughs, only five (10.4%) were therapist as speaker, whereas 43 (90.3%) were as nonspeaker audience. The difference was highly significant (p < .001). Physiologic data showed that mean SC level increased regardless of role as patient, therapist, speaker, or audience (p < .001). Two-factor analysis of variance indicated that SC change scores were significantly larger when patients and therapists laughed together compared with laughing alone (p < .05). The results support an empirically based approach to the study of laughter and the use of psychophysiology as a measure of process during psychotherapy.