The chapter deals with selected features of Peirce's earliest thought on representation preceding the formulation of his Semiotic. It concentrates on giving account of the genesis of his later "thorougly unpsychological view of logic" (1865, W 1: 164) as it can be traced in the collection of "Three Essays on Infinity and God" (1859, W 1: 37-43).
There Peirce, using the example of the conception of infinity, analyzes the "unthinkable" representation, asking in what way it is possible to assert true propositions of the object of such representation. The analysis Peirce's argumentation leads to the conclusion that his answer, though presented as a special case of the original psychological exposition of representation which generated the problem in the first place, leads to overcoming that original theory.
Peirce answers that we "have the conception of the conception infinity though the conception itself we never have" (1862, W 1: 82)--meaning that we (through definition and formulation of certain operations) construct a conception standing for the unthinkable conception which thus mediately through the nota notae principle stands for the object of the unthinkable conception as well. Because this model of constructing the thinkable representation standing for the unthinkable one can be--through parsimony--applied to the account of any representation at all, the thinkable representation included, the original psychological account of its functioning becomes redundant.
It is precisely this model upon which Peirce later on founded his purely formal, anti-psychological semiotic theory.