“Gaming the Trace” builds up the power of narrative structures from a consideration, first, of the trace – the event of minimal inscription – and next, of what is latent in the reception – that is, the construction – of the trace. I coin a word to capture this combination of grammatological event and observing process, semiolepsis, and relate these dynamics to an allegory of narrative reception. Metempsychosis, or the tale of the transmission of the soul from one body to another, comes forward as an allegory of the reception of the trace. From here the essay moves to an interrogation of the movie Avatar’s mise en scène of the avatar system – its telling, its design specs, and its phantasmagoric realizations of technological metempsychoses. It turns out that an actual media technology exterior to that frame feeds another digital “transmission of soul” back into the physiological metamorphoses of the storyworld. Relevance: The essay expounds as well as applies a broadly Luhmannian framework of systems differentiations. Its methodology throughout is an application of epistemological constructivism and second-order systems theory.