The Softer Side
Why do you say that?

Imagine never knowing who your father is, and knowing nothing of your mother save for her name: Jenova. Imagine growing up alone in a city, being constantly monitored by its organization more interested in what you are than who you are. Imagine having as an only friend a scientist who just happens to lead a secret project dealing in experiments of mutation, and who knows more about you than he lets on. Imagine knowing deep within the recesses of your soul, that you are different from all the others, without knowing why or how.

And then imagine joining an elite fighting organization, quickly earning fame as the best of fighters. Imagine journeying out on what was supposed to be a routine mission, to investigate the origin of a series of supposed monster attacks on a nearby town.

Now, imagine finding the cause of all these monster attacks: a room filled with pods bearing human beings injected with monster serums that irrevocably changed and transformed them into uncontrollable beasts. And then imagine that you find a sealed room in that place, seemingly interconnected to the the monsters in the pods and supplying them with nourishment and cells with which to sustain themselves in stasis? And then realizing that this sealed room had been labelled "JENOVA", for all regards the name of the creature sealed within - the same as that of your alleged mother's?

How would you react?

Sephiroth reacted - violently. But hypothetically speaking, what sane man wouldn't go mad when confronted by the discovery that he after all, may not be human?

Sephiroth wasn't always the cold-blooded power-hungry psychotic killer he is usually depicted in the game - his warm and friendly side can be seen in Cloud's flashbacks. Prior to arriving at Nibelheim to investigate the monster attacks, Sephiroth can be seen talking amicably with Zack/Cloud, and even the lowly escort guards, stopping to ask, concernedly, if one of the motion-sick guards were alright. Sephiroth did not earn people's respect simply because he was the best fighter of that time - rather, he earned their respect because he was also a warm and caring human being.

The discovery that he may not be human after all unhinged his mind. He was shocked, and began clawing for a logical explanation to convince himself that he was human, but there were too many coincidences against that fact. Secret reports uncovered at the Shinra library revealed that he was actually the product of the JENOVA project, conceived for just that purpose, and injected with JENOVA cells. There was the fact that he was told his mother's name was JENOVA, by a scientist who also happened to be in charge of the JENOVA project. There was his secret belief that he knew he was somehow special from all the other people, and this revelation was only further proof that he was, but not in the way that he wanted.

It was at this point that, as he remained locked in the Shinra library for three days, JENOVA was able to reach into and manipulate his tortured mind easily, encouraging him in fact towards insanity. There was a very drastic change in Sephiroth in between the time he locked himself in the library till the time he emerged from it. Could it be possible that, locked away from his friends (Zack, etc.), his mentor and only one who could have willingly told him the truth (Professor Gast) dead for years previous, with nothing else to find solace in other than the dreaded realization that he was not human, JENOVA plagued his already mad mind with lies, shaping him into the Sephiroth who burned Nibelheim down and slayed his own friends?

Sephiroth was a smart and logical man. He was determined to do good in his job, and he was quick to earn others' respect. He also expected the same perfection in others as he expected in himself, and his mind controlled his heart. One of his main flaws would be his arrogance; he has always taken for granted that he was the best, and easily underestimated the strength of those around him, believing that his own was enough to pull them all through. By all appearances, he did not seem like an easy man to be manipulated. But circumstances of his birth and childhood, the shock of his discovery at Nibelheim still fresh on his mind, caused him to question everything that he had ever believed in, which was the source of his own strength. And when JENOVA made him doubt that, Sephiroth was lost.

I like to think that Sephiroth is the darker side of Cloud's mirror. Both have the same type of personalities, though both walked down different paths. Both were arrogant in their own right, seemingly aloof, knowing that they're not like other people. Both are determined and dedicated to what they do. However, Sephiroth's mind was severely weakened by JENOVA, and because of this, all his previous beliefs were nothing more than illusions. Cloud on the other hand, still maintains a firm hold on his beliefs, like his promises to Tifa and Aeris, though he was being controlled to a weaker extent by Sephiroth. Should their roles had been reversed, it would be quite likely that Cloud would act the same way as Sephiroth had done, and vice versa (though Sephiroth would have been a little more arrogant in going about it).