In Watts’s treatment, the notion of lila, or divine play, functions as a key image for understanding existence itself. Reality is likened to a cosmic drama or game in which the one ultimate Self—variously evoked as God, Brahman, or the Ground of Being—“plays” at being many separate beings and worlds. This activity is not a utilitarian project aimed at some external end; it resembles theater, music, or dance, where the value lies in the performance rather than in a product. The universe’s unfolding is thus portrayed as spontaneous and purposeless in the narrow, goal-oriented sense, yet intrinsically meaningful as the free, creative expression of the divine.

Within this framework, the apparent fragmentation of life into “me” and “not me,” joy and suffering, gain and loss, is interpreted as part of the plot of the play. The divine consciousness hides from itself by identifying with individual egos and limited forms, generating the drama of separation, conflict, and eventual awakening. From the standpoint of the ultimate Self, even tragedy, limitation, and struggle are elements that give contrast and intensity, much as villains and crises give shape to a story. Without this illusion of separateness, there would be no experience of discovery, no dynamic movement within the cosmic game.

Watts further illuminates lila through the idea of the persona or mask. Each individual is a role, a mask worn by the single Actor, so that ordinary ego-identity is not the whole of what one is but a temporary character in the divine performance. Recognizing this does not entail apathy or withdrawal; rather, one plays one’s role wholeheartedly while understanding that it is, at root, a role. This insight loosens the grip of anxiety and compulsive seriousness, since the deeper reality cannot be ultimately harmed by the ups and downs of the storyline.

Seen in this way, lila becomes a bridge between Eastern and Western images of the divine. Instead of a stern planner overseeing a moral test or industrial project, the divine appears as creative, playful intelligence exploring its own possibilities. Life is then approached less as a burden to be justified and more as a dance to be fully participated in. The “taboo” against knowing who one is begins to dissolve when it is realized that existence is not something done to isolated selves, but the Self’s own playful exploration of itself through all beings and events.