The variable, degree of family boundary ambiguity, is increasingly being used in family research to describe and predict the effects of family membership loss and change over time. Boundary ambiguity is defined as the family not knowing who is in and who is out of the system. The family may perceive a physically absent member as psychologically present or a physically present member as psychologically absent. In either case, the family boundary is ambiguous. This review is presented to clarify the meaning of boundary ambiguity and to explore its scope and application as a variable. We focus here on (a) the process of theory development, inductive and deductive, by which the construct of boundary ambiguity was identified and validated as a continuous variable within family stress theory; (b) the historical antecedents of the construct; and (c) the interrelationships of the variable with other factors related to stressed families.