For the seeker immersed in the first stage of the realization, the infinite, vast, expanse of the universal space seen as ‘container’ of all existence, the world of forms and forces appears unreal, something like a motion picture of ever-changing images that in themselves have no substance.
The second stage works to overcome this one-side limitation and integrate the reality of the manifestation as consisting of, and inhabited by the Divine. The Isha Upanishad declares: “All this is for habitation by the Lord, whatsoever is individual universe of movement in the universal motion.” (Sri Aurobindo, The Upanishads, Isha Upanishad, v. 1, pg. 19) The Divine inhabits all forms in the universe and is both the “container” and the “contained”. The Isha Upanishad goes on to describe this reality even further. Sri Aurobindo himself declares that the concept of the illusion of the world is incorrect when he describes the “omnipresent Reality”.
Sri Aurobindo observes: “But these things are not empty, not mere unreal name and form imagined by a cosmic Mind; they are, as we have said, in their reality self-conscious becomings of the Self, that is to say, the Self dwells within all of them even as within us, conscious of them, governing their motion, blissful in his habitation as in his embrace of all that he becomes. As the ether both contains and is as it were contained in the jar, so this Self both contains and inhabits all existences, not in a physical but in a spiritual sense, and is their reality.”
This is not a matter of intellectual acceptance; rather, eventually there needs to be a realization in the being, such that the seeker sees and acts from the understanding of “…the Self in all existences and all existences in the Self…” as described by the Isha Upanishad (v. 6). He attains the realization: “He in whom it is the Self-Being that has become all existences that are Becomings, for he has the perfect knowledge…” (Isha Upanishad v. 7)
The seeker must embody this realization: “We have, putting aside all vain resistance of the intellect and the mental associations, to know that the Divine inhabits all these becomings and is their true Self and conscious Spirit, and not to know it only intellectually but to know by a self-experience that shall compel into its own diviner mould all the habits of the mental consciousness.”
Sri Aurobindo, The Synthesis of Yoga, Part Two: The Yoga of Integral Knowledge, Chapter 10, The Realisation of the Cosmic Self, pp. 355-356