This is the second paper in a series of three, the objective of which is to describe the fundamental discontinuities of human existence. Self-reference is explored in the first section of this paper, arguing that neither time-space nor developmental dimensions are adequate to explain the problem of self-reference. It is argued that self-reference might indeed be an uncognizable degree of freedom that governs human existence. The founding propositions of the discontinuity theory then state that human existence subexists as difference, time-space, development, and self-reference. The second section maintains that human existence can be modeled as discursive strings encompassing a context-agent enacting an agent enacting an objective, where the objective itself can be an agent enacting an objective, and so on. The general theory of discontinuity is described in section 2. Section 3 encompasses the specific theory of discontinuity that builds on the heritage of classic theories explored in part 1. The theory encompasses three different forms of development: (1) canalization, which includes perspectivizing; (2) correlation, which includes systematizing; and (3) combination, which encompasses organizing. Nineteen figures illustrate the discussion. (Contains 18 references.) (SLD)