The relationship between psychoanalytic theory, clinical practice, and political movements regarding homosexuality has undergone significant transformation over the past seven decades. This review examines the historical arc from Freud’s ambivalent early writings through mid-20th century pathologization, the pivotal 1973 depathologization in DSM-II, and contemporary affirmative psychoanalytic frameworks informed by minority stress models. Psychoanalysis has alternately served as a tool for institutional regulation and exclusion, and more recently, as a resource for developing gay-affirmative, politically conscious clinical practice. This article traces how theoretical constructions of sexuality became entangled with legal regimes, professional power, and social movements, and argues that contemporary psychoanalysis must maintain explicit political awareness to prevent the repetition of ideological harms in therapeutic contexts. The evidence base for LGBTQ-affirmative interventions and the integration of minority stress frameworks into psychodynamic formulations represent significant advances toward ethical, non-pathologizing mental health care for sexual minorities.