Lily awakens in Gerty's bed the following morning. When Gerty enters the bedroom, the closeness the two women shared the evening before is dispelled. Gerty has phoned Mrs. Peniston to inform her as to Lily's whereabouts.
Lily returns home to Mrs. Peniston. She determines that she will repay Trenor an amount that she estimates is nine thousand dollars. She requests a private conference with her aunt prior to Lily's appointment with Selden. Lily confesses to her aunt that she has financial worries as a result of clothing extravagances and gambling losses — while withholding from Mrs. Peniston the true extent of her debt — in the hopes that Mrs. Peniston will give her enough money to repay Trenor.
Mrs. Peniston expresses her intense displeasure at Lily's admission that she has been gambling — and that she has played cards on Sunday. On these grounds, she offers to give Lily only $1,000 to pay a dressmaker's bill.
Upset, Lily waits for Selden's arrival. She had initially hoped to find refuge in his company in the event Mrs. Peniston gave her the money to repay Trenor. Now, possessed with the knowledge that her aunt will not help her, she harbors hopes that Selden will marry her and enable her to put her troubles behind her.
Selden never arrives, however; instead, Rosedale pays Lily a visit. He boasts that he is now among the wealthiest men in New York, and that he intends to take a wife to help him share in his fortune. He assures Lily that his wife shall have more than she ever desired, and certainly enough to make every other society woman jealous.
