The scene opens in Rome. Antony has now returned to Egypt, and Caesar tells two of his officers, Maecenas and Agrippa, about Antony's recent activities there. Antony has formally appointed Cleopatra to be Queen of Egypt, lower Syria, Cyprus, and Lydia, and he has also made his two small sons titular kings of various lands which he has conquered. Caesar interprets Antony's actions as being political ploys to usurp the authority of Rome; thus, they are an insult to both the empire and to Caesar personally.
As a further insult to himself, Caesar says, Antony (in a letter, apparently) has accused Caesar of not giving him his due portion of Pompey's realm in Sicily and that he has also suggested that Caesar's detention of Lepidus was solely for the purpose of acquiring his property. Caesar says that he has sent a messenger to explain why Lepidus was arrested. He also agrees to grant Antony part of the kingdom that he, Caesar, has conquered, but only if Antony reciprocates by granting him land from his own conquests. He suspects, however, that Antony will never agree to this.
Octavia arrives with her attendants, and Caesar chides her for giving him no warning that she was coming; he had no time to welcome her with proper ceremony. She tells him that she heard that Caesar was making preparations for war, and when she begged to return, Antony allowed her to do so. Caesar tells his sister that Antony's real reason for permitting her to return to Rome was for one reason only: so that Antony could return to Cleopatra. Octavia is agonized that her brother, Caesar, and her new husband, Antony, "do afflict each other."
Here we see Caesar finally deciding to take overt action against Antony. He would not have dared to do so earlier, but because of Antony's return to Egypt, because of Antony's assertion of military and political authority there, and because of Antony's adulterous insults to Octavia, Caesar now has sufficient reasons to do what he has wanted to do all the time — that is, he can now attack Antony, defeat him, and become sole ruler of the world.
If Antony were more farsighted and if he had realized what an ambitious foe Caesar was, perhaps he would have been more careful in giving Caesar an excuse to attack him. But one suspects that even if Antony had not given Caesar sufficient reasons to provoke him, Caesar would have created them. Very simply, Caesar is overly ambitious and pathologically power-hungry.
When we hear Caesar say that he explained to Antony in a letter that Lepidus was deposed because he was "too cruel; / That he his high authority abus'd," one should not miss the irony here. Of all people, the ineffectual and powerless Lepidus is most unlikely to have abused his authority. It is Caesar himself who would be most likely to abuse "high authority." But such duplicity is as typical of Caesar in achieving his goals as it is of Antony and Cleopatra. Caesar deceives himself; he rationalizes acts that further his ambition, and Antony likewise deceives himself when he believes that what he is doing will have no consequences; naively, Antony sees no danger in spending time with Cleopatra. As another example of self-deception, we have just witnessed how Cleopatra deceives herself; she interpreted the messenger's description of Octavia as being wholly negative in order to satisfy her need to believe that it is she alone whom Antony really cares for.
Caesar's duplicity here is evident even in the way he scolds Octavia for not giving him a chance to welcome her properly. In fact, he is really less concerned about her than he is about his last opportunity to show the world how badly Antony has treated his sister. This motive is unstated, but it is clearly consistent with the self-serving way in which he has explained other events — for example, Lepidus's fall from favor.