I see it this way;
The opening shot of dancers and then Diane and the old couple is a daydream fantasy of Diane’s. We are clued into this by the blurry zoom that introduces Diane and the old couple into the scene – an effect we see again later when Diane is sitting on the sofa and trying to fantasise.
The next scene is a real shot of Diane moving across the bedroom and onto the bed – she looks for a few seconds at the floor by the side of the bed where so much else happens in the dream world.
Diane hits the pillow and dreams the main section of the film
Diane wakes up to the knocking and lets in the woman who has come for her dishes and lamp
Diane makes coffee and has a vision of Camilla in the kitchen – this establishes to us the audience that Diane has waking visions and is “seeing” Camilla where she is not.
As she goes to the sofa her robe acts as a curtain indicating to us that the next scene with Camilla is not real(not even a real flashback). She is again projecting the movie star image of Camilla over a real flashback.
The same with Camilla at the door – the scene maybe real or close to real but it did not happen with Camilla
She fails then to fantasise until the phone rings and she goes back the red lamp phone from the dream.
The first time we saw that phone was at the end of the chain of calls when Mr Roque said the girl is still missing. That time dreaming Diane was able to introduce Betty as the missing girl, in the hope of fooling Mr Roque.
This time she lets Mr Roque introduce the girl he wants into the story – Diane
That said the phone call is not a real memory but another daydream/fantasy. The same with the drive up to MD and the walk up the garden path is channelling much deeper memories that a recent walk with Camilla. Hence why Diane seems so child-like in the walk.
The pool scene brings Diane back down again from this fantasy to a more horrible one where Adam exists as Camilla’s love interest and Coco does not seem to like Diane at all.
Diane nearly breaks the fantasy here and comes back to her living room but keeps going and gets to the dinner table fantasy scene. When that becomes unbearable with the imminent announcement from Adam she breaks from that to the fantasy in the diner with Joe. After talking with Joe she really is “maxed out” and there’s nowhere left for her fantasies to take her and she’s back in her living room with her loopy thoughts.
The knock at the door sends her over the edge and she shoots herself.
This means that very little of what we see is “real” and nor should we consider too much of what we see to be based on reality. I agree with comments I’ve seen here that say it would be silly to reduce everything to “David Lynch made a film and that is all we can say” but I think we need to be careful to add too much to the real scenes that Lynch hasn’t put there.
The woman who comes to collect her dishes and lamp seems to be the only other person in a “real” scene and it’s no great stretch to see her as a former lover of Diane.
If Diane has been projecting Camilla onto her real lover then it’s her who says, “You’re playing a dangerous game here.” And “You drive me wild”, etc.
I think I will have finished my Mulholland Drive when I can fully park Rita/Dark-haired Camilla back up in the poster on the bathroom wall that dreaming Diane plucked her from!




