In the Yoga Vasistha, consciousness (cit, caitanya) is presented as the fundamental, unchanging reality that underlies all existence. It is pure, undifferentiated awareness, self-luminous (svayam-prakāśa), knowing itself by itself and not dependent on anything else for its illumination. This consciousness is eternal and self-existent, not produced, modified, or destroyed by any cause. It is described as infinite and all-pervading, without real divisions or boundaries, and thus non-dual in nature. Apparent multiplicity arises only as an appearance within this one reality, not as something truly separate from it.

The text further identifies this consciousness with both the innermost Self (Ātman) and Brahman, the absolute reality. As such, it is the substratum upon which the entire universe appears, much like a city reflected in a mirror or a snake imagined in a rope. Names, forms, time, space, body, and world are portrayed as ideations or appearances in consciousness, rather than independent entities. Consciousness itself does not undergo transformation when the universe appears in it; instead, mind and world are likened to movements or thought-waves within the same unchanging awareness. The sense of individuality—“I am this person”—is treated as a thought arising in, and made of, that very consciousness.

Yoga Vasistha also emphasizes that consciousness is beyond the subject–object division. The seer, the act of seeing, and the seen are ultimately one in this non-dual awareness, which serves as the immutable witness (sākṣī) of all states—waking, dream, and deep sleep—without itself being altered. At the same time, consciousness is described as possessing an inherent creative power through which the entire phenomenal world appears, comparable to how dreams arise in the mind. Recognizing one’s true identity as this pure, self-luminous consciousness, rather than as the transient body–mind complex, is held to be the key to liberation, since such recognition dissolves the illusion of separation and reveals the ever-present, undivided reality.