This book describes a theory of memory representation, organization, and processing for understanding complex narrative texts. The theory is implemented as a computer program called BORIS which reads and answers questions about divorce, legal disputes, personal favors, and the like. The system is unique in attempting to understand stories involving emotions and in being able to deduce adages and morals, in addition to answering fact and event based questions about the narratives it has read. BORIS also manages the interaction of many different knowledge sources such as goals, plans, scripts, physical objects, settings, interpersonal relationships, social roles, emotional reactions, and empathetic responses. The book makes several original technical contributions as well.