The dualistic Self, or Ego or dualistic consciousness, is what prevents us from experience others as they are. All we experience is our own consciousness, and that only in a very distorted manner, as a limited and to a greater or lesser degree narcissistic entity that is continually having to defend its own existence via ego-defense mechanisms which deny and repress its own constantly generated negativity. This becomes the shadow or personal unconscious, which is projected outwards as attacks on or hatred of the Other (which to the Dualistic Self is non-being and evil).
At the same time, through narcissism and inflation falsely identifies itself with the Supreme.
Dualistic Consciousness pertains to the state of existence that Kashmir Shaivite calls the Ashuddha-tattvas or "Impure" principles or evolutes. This is defined as existence subject to karma and reincarnation, and include physical, psychic, and even spiritual states of consciousness. In Kashmir Shaivism this division includes occult (gods, etc) as well as ordinary dimensions of existence.
This is the state of the reincarnating being (sakala, jivaatma) which is under the sway of karma (law of reaction) and avidya (metaphysical ignorance). This comes about because the connection with the authentic Self, which is non-dual consciousness, has been lost.
The goal of the spiritual path is to dissolve or transcend these limitations and realise one's ultimate identity (whether as a nondual Absolute or an individualised Divine Soul in I-Thou relationship) with the Supreme Self
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