This study examined the way in which a terminal cancer prognosis was negotiated by patients and their lay carers, and the complexities involved in managing a context of awareness. Individual semi-structured interviews were undertaken with 16 patients and 14 lay carers. These were transcribed verbatim and analysed using a grounded theory approach. The process started with being given bad news, when the concept of life was no longer open-ended. The need to maintain hope influenced the amount of information sought by patients and their families and was an important strategy in helping patients cope with the knowledge of their disease. Levels of awareness appeared to be influenced less by setting, than by the way the prognosis was managed within individual families. Difficulties facing patients and carers in knowing how to communicate with each other within a context of open awareness suggest that they need help in learning how to do this. Achieving an environment to enable this requires private space and staff skilled in enabling and facilitating the complexities of communication between patients and their carers.