The concepts of privileged communication and confidentiality are of importance in both therapy and mediation. In therapy, the mental health professional's role is to facilitate understanding. In mediation, the mediator seeks to facilitate cooperation, negotiation, and problemsolving. In cases such as child custody and divorce, anticipation of adversary proceedings often produces distrust, limited disclosure, and lack of cooperation between parties -- thus producing a situation antithetical to the goals of either therapy or mediation. While the mental health professional-client relationship is covered by confidentiality and privileged communication statutes, still at issue is whether privilege is waived by the presence of more than one party or when one party wishes to release information but the other does not. In the case of a mediator, the situation is even more problematic. While confidentiality in attempts to settle family disputes seems essential, it is not clearly protected under existing statutory privilege. While some information is privileged under the rules of evidence, which information is privileged usually cannot be determined until after mediation is over and will depend on the interpretation of case law and the nature of questions which arise in the adversarial proceedings. These issues must be resolved at the public policy level. Appended discussion examines court treatment of confidentiality and privilege in additional mediation cases.