Modern social theory is awash with talk of “discourse” and “ideology”. Sometimes the two concepts are used interchangeably and at other times they are counterposed. The paper seeks to make sense of the part played by these concepts in contemporary debates. It proposes an exercise in retrieval which suggests that our two key terms form distinct theoretical traditions which, while they can be distinguished, can both be made good use of. We first engage with the debate over ideology within modern western Marxism and explore the suggestive distinction proposed by Larrain between a negative and a positive conception of ideology. Next we explore Foucault's version of discourse theory. Our third investigation focuses on the work of Ernesto Laclau and Chantal Mouffe who opt for a rupture between discourse and ideology; their solution will be contrasted with the Gramscian position espoused by Stuart Hall- the approach closest to the solution we will propose-that retains the concept ideology whilst benefiting from the advances secured by discourse theory.The theory of ideology we propose supplements discourse theory rather than opposing it. It is a version of ideology theory that is different from that bequeathed by Marx. Retained and moved into central prominence is a key feature of the critical thrust of Marx's account, namely, its focus on the way in which the interpellation of subject positions operates systematically to reinforce and reproduce dominant social relations—it is this that is described as the “directionality” of ideology theory. This directionality is captured by employing ideological analysis to focus upon the effects of discur­ sive practices, which we term “ideology effects”.