In his classic work "Freedom from the Known", Jiddu Krishnamurti asserts there is no separation between the observer and that which it observes. This separation is known as the illusion of self; the sense of there being a thinker of thoughts separate from the thoughts, the sense of there being an experiencer separate from that which is experienced.
Krishnamurti explains that which we observe (external stimuli we perceive with our senses) invokes a reaction within us, based on our past experiences, memories, culture, training, associations, inclinations, acquired and inherited characteristics, etc. Things happen to us. Based on our perception of our self-image, we react to these external things and events on a scale of like / dislike, building our own personal images of these external things we observe. For example, when you see a person you don't know, you may already have a first impression of them - based on your past experiences, memories, opinions, knowledge, interactions, etc (it is interesting to note you can form images of other people without knowing anything about them). As you continue to interact with this person, you continue to build your own personal image of who they are - a result of you observing them, and your perception of your own self-image.
Consider an action or event that you view as wrong or unjust - why is it that you feel that way? Trace back this opinion to the beginning. What causes you to form your opinions regarding what is right and wrong? How would you know that stealing (or anything) is wrong, if you have never had any past experience that taught you so? At some point in your life, you observed something. You had a reaction to that which was observed (based on your past observations and images), and you formed an image. In creating this image of what you observed, your image of self was influenced, shaped, and molded into something new.
Krishnamurti claims that the observer itself is an image - a result of all these other images we create. We observe that which we perceive through our senses, we create images based on our observations, and these images shape and mold the self-image we perceive as the observer. The observer or illusion of self is nothing more than another image we observe - the observer is in fact the observed. It is not separate from that which it observes. This awareness or realization is sometimes referred to as self-transcendence, or ego transcendence.