The dispute over the ghosts' reality has had a real effect on some critics, most notably Edmund Wilson, one of the first major proponents of the insane governess theory. Wilson eventually recanted his opinion after considering the governess's point-by-point description of Quint. Then John Silver pointed out hints in the story that the governess might have gained previous knowledge of Quint's appearance in non-supernatural ways. This induced Wilson to recant his recantation and return to his original opinion that the governess was delusional and that the ghosts existed only in her imagination.
William Veeder sees Miles's eventual death as induced by the governess. In a complex psychoanalytic reading, Veeder concludes that the governess expressed her repressed rage toward her father and toward the master of Bly on Miles.
Other critics, however, have strongly defended the governess. They note that James's letters, his New York Edition preface, and his Notebooks contain no definite evidence that The Turn of the Screw was intended as anything other than a straightforward ghost story, and James certainly wrote ghost stories that did not depend on the narrator's imagination. For example, “Owen Wingrave″ includes a ghost that causes its title character's sudden death, although no one actually sees it. James's Notebooks entry indicates that he was inspired originally by a tale he heard from Edward White Benson, the Archbishop of Canterbury. There are indications that the story James was told was about an incident in Hinton Ampner, wherein in 1771 a woman named Mary Ricketts moved from her home after seeing the apparitions of a man and a woman, day and night, staring through the windows, bending over the beds, and making her feel her children were in danger.
Perhaps the critical perspective that best captures James's own thinking and methods, given the work's notably rococo style, which incessantly qualifies statements and counters any attempt at straightforward exposition, is that of Brad Leithauser:
All such attempts to 'solve' the book, however admiringly tendered, unwittingly work toward its diminution[; its] profoundest pleasure lies in the beautifully fussed over way in which James refuses to come down on either side... the book becomes a modest monument to the bold pursuit of ambiguity.
According to Leithauser, we are meant to entertain both the proposition that the governess is mad and the proposition that the ghosts really do exist, and consider the dreadful implications of each.
James revised the novella substantially over the years. In The Collier's Weekly Version of The Turn of the Screw, Peter G. Beidler presents the tale in its original serial form and presents a detailed analysis of the changes James made over the years. Among many other changes, James changed the children's ages.
Poet and literary critic Craig Raine, in his essay "Sex in nineteenth-century literature", states quite categorically his belief that Victorian readers would have identified the two ghosts as child molesters.