The MPAA (The Motion Picture Association of America; formerly The Motion Picture Producers and Distributors of America) was formed as a trade association in 1922 under president Will Hays. The MPAA surveyed state censorship boards in order to issue a standard list of subjects that filmmakers should avoid putting on screen, as well as a subsequent (and rather vague) list of "Be-Carefuls," which contained subjects that had the potential to incite the ire of the MPAA. This list included items like "murder techniques" and "excessive and lustful kissing" (Balio 268). The Production Code was amended and adjusted a number of times over the years, but it remained that any MPAA member who tried to release a picture without a Hays Office seal of approval would be subject to a $25,000 fine. If a particular screenplay violated the Production Code, producers would hesitate to make the movie and exhibitors would shrink from showing it, so it was in everyone's best interest to comply.
Per industry requirements, Hitchcock sent the script for Psycho to the MPAA; he was not surprised that many lines and suggested images in the screenplay raised the censors' eyebrows. After removing a number of uses of "damn," "God," and "hell," as well as downplaying the insinuation of an incestuous relationship between Norman and his mother, the Production Code office allowed Hitchcock to move forward with production but only would agree to approve it for distribution after they saw the final film. Twenty or even ten years earlier, there is no way the MPAA would have allowed Hitchcock to commence production, but it was now the 1960s and the mindset of Production Code officials had shifted along with the cultural changes happening around them.
Once Hitchcock had a cut of Psycho that he was happy with, he sent the film to the censors. He was fully prepared for their objections, but by this point in his career, he knew exactly how to manipulate them into letting him have his way. The censors absolutely flipped out over the shower murder, but because it contains some 75 cuts over only 45 seconds, some saw nudity, while others didn't. They sent the film back to Hitchcock and demanded that he remove any nudity, to which the director agreed. However, he did not change a single frame and sent the exact same cut back to the censors the second time. Again, some of the viewers saw nudity in the shower scene and others didn't. They eventually let it all slide. Hitchcock even offered to redo the opening scene with Sam and Marion in bed, and invited the censors to watch production, but they never showed up. Hitchcock never reshot the scene. The Catholic Church Legion of Decency gave Psycho a B, which meant that it was "Morally objectionable in part for all." This served as a warning to audiences but the Church could not outwardly censor the film. Meanwhile, the British Censors gave the film an "X" and demanded cuts.