Artificial-agent technology has become commonplace in technical research from com-puter graphics to interface design and in popular culture through the Web and computer games. On the one hand, the population of the Web and our PCs with characters who reflect us can be seen as a humaniza-tion of a previously purely mechanical interface. On the other hand, the mechanization of subjectivity carries the danger of simply reducing the human to the machine. The author argues that predominant artificial intelligence (AI) ap-proaches to modeling agents are based on an erasure of subjectivity analogous to that which appears when people are subjected to institutionalization. The result is agent behavior that is fragmented, depersonalized, lifeless and incomprehensible. Approaching the problem using a hybrid of critical theory and AI agent technology, the author argues that agent behavior should be narratively under-standable; she presents a new agent architecture that struc-tures behavior to be comprehen-sible as narrative.