At present, researchers are unclear about which activity within the brain is responsible for the emergence of consciousness-the subconscious or unconscious. Current literature suggests that consciousness is isolated in the brain; however, we suggest consciousness emerges from both-subconscious and unconscious activity, in addition to sensory consciousness. This article contends that sensory consciousness arises from neurophysiological brain activity, intrapersonal space, sensory information, and parallel processing of the external and internal environment through vision, olfaction, the integumentary system, gustation, and audition. Traditionally, lateral inhibition is defined as the ability for an excited neuron to laterally inhibit its neighbors, and is an integral part of neurophysiology in all senses. In this article, we are connecting the science behind the well-established physiological observations of gamma wave activity in the interneurons of peripheral receptors with what is currently unknown regarding the functional significance of seemingly unrelated gamma activity in the cortico-thalamic gamma oscillations. We suggest that this allows for instantaneous integration of the brain with sensory receptors. This article uses existing literature on lateral inhibition to investigate its role in sensory organs and various areas of the body. We explain how sensory consciousness is only one component of unified consciousness. We propose that lateral inhibition also plays a vital role in consciousness theory, and understanding this can help illustrate the dynamic interactions between the central and peripheral nervous systems within the body.