What Freud meant by this metaphor was that the human mind is more than just our consciousness; the consciousness is just the tip of the iceberg, so to speak. Beneath the water, there's a lot more ice submerged. This ice is a metaphor for the subconscious, which Freud set out to explore in his work as a psychoanalyst.

What Freud is getting at here is that the human mind and its workings are a lot more complicated than most of us tend to think. As with the iceberg, there's a lot more going on beneath the surface, as it were—much more for the psychoanalyst and his patient to explore.

Remaining at the level of surface consciousness doesn't tell us an awful lot about the mind. At best, it can only give us a very superficial understanding. It's only when we go beneath the surface that we start to gain a much deeper understanding of how the mind operates.

In doing so, we're dealing with the subconscious, the biggest chunk of the iceberg, so to speak, the most important part of the human mind. It is the subconscious, according to Freud, that contains all the important stuff that helps to explain why we act the way we do; all those repressed memories, feelings, and desires that have had to remain submerged in the depths of our subconscious in order to ensure that we can function in society.

While it is uncertain that Freud actually said or wrote this, it is congruent with his thinking about the human mind.

Freud spent the early part of his career studying "hysterical" females, women who exhibited very emotional or seemingly social deviant behaviors. He realized over time that this behavior came from repressed memories, thoughts, and desires. As he studied this further, he came to understand that all humans repress much of what goes in their lives and imaginations, relegating these thoughts and memories to the unconscious. In most people, this is a largely healthy defense mechanism: we would not be able to survive and thrive were we continuously conscious of, for example, our fear of death, painful memories, or our sometimes aggressive feelings towards those we love. These feelings are submerged unseen by people below the surface of their conscious minds, just as most of an iceberg is submerged.

The problem comes, Freud asserted, when people repress too many unresolved conflicts. In what he called the return of the repressed, these unresolved issues present as psychological symptoms, just as a person with a physical disease presents with symptoms that indicate that something is awry internally. This is where, according to Freud, talk therapy becomes beneficial: if a person can dredge up more of the "iceberg" of the unconscious, he or she can begin to deal with these submerged problems in a healthier way.

The quote uses the analogy of an ice berg to demonstrate that only a small portion of the mind is 'visible'.

In Freud's theories of conciousness, the concious mind is the 'tip of the ice berg'. Working, in 'layers' underneath, is the preconscious and unconscious minds.

The preconscious is responsible for recall and can be accessed via cues. For example, you usually don't actively think about your email address, but if someone asks for it, you can access that information instantly. In the ice berg analogy, the preconscious mind is just below the surface. The waves and motion of the ocean can expose these parts of the berg, but mostly it remains just out of view.

The unconscious mind underlies our base feelings and emotions. This is like the 'base of the ice berg, hidden far below the ocean'.