The next morning, Santiago awakens to see rows of date palms stretching across the entire desert where previously he had seen only stars. The Englishman is relieved to have reached the oasis; he can now find the alchemist. Santiago thinks about his treasure, and how far off it still remains. He notices that the closer he comes to realizing his dream, the more distant it seems.
Meanwhile, the alchemist is watching. He notices the overwhelming happiness of the travelers, who appreciate the sudden greenery of the oasis. "Maybe God created the desert so that man could appreciate the date palms," he thinks. He then decides to focus his attention on more practical matters. Omens have told the alchemist that an important man arrived with the caravan. He is supposed to teach this man the secrets of alchemy.
The camel driver tells Santiago that an oasis is considered neutral territory because it is populated mostly by women and children. The warring tribes fight in the desert and leave the oasis alone. Because an oasis cannot harbor troops, all the travelers from the caravan have to surrender their weapons.
Santiago and the Englishman ask a black-veiled woman and several men about the alchemist. All claim not to know his exact whereabouts. They do, though, refer to the alchemist as both a witch doctor and "the very powerful one."
Santiago next approaches a pretty young woman by a well. Her head is covered, but not her face. Instead of asking her where the alchemist lives, Santiago is struck dumb. "At that moment, it seemed to him that time stood still, and the Soul of the World surged within him . . . he learned the most important part of the language that all the world spoke — the language that everyone on earth was capable of understanding in their heart. It was love."
Prodded by the Englishman, Santiago puts aside his feelings for the girl, whose name is Fatima, and asks her where the man who cures people's illnesses lives. Fatima points to the south. The Englishman then disappears to find the alchemist, and Fatima leaves with her water. Santiago remains at the well, thinking about her. He knows instinctively that his love for Fatima will "enable him to discover every treasure in the world."
Santiago returns to the well the next day hoping to find Fatima. Instead, he encounters the Englishman, who found the alchemist and told him that he wanted to learn the secrets of alchemy. The alchemist asked if he had ever turned lead into gold. No, the Englishman said — that was what he had come to the oasis to learn. "He told me I should try and do so." After the Englishman departs, Fatima arrives at the well. Santiago tells her that he loves her and wants her to be his wife. Fatima drops her jug and spills some water.
After a month at the oasis, the caravan leader calls all the travelers together and tells them that because the tribal war is still raging, they won't be able to travel any further. Santiago searches for the Englishman and discovers that he has built a wood-burning furnace outside his tent. The Englishman tells Santiago that he is completing the first phase of alchemy, separating out the sulfur. To do this, a person can't be afraid of failure, and that fear is what kept the Englishman from trying to accomplish the Master Work.
After the sun sets, Santiago explores the desert, hoping it will tell him whether or not he should continue his quest. Soon he sees two hawks flying in the sky. When one hawk attacks another, Santiago envisions an army attacking the oasis.
Later, Santiago tells the chieftains who run the oasis of his vision. The chieftains wonder why the desert would reveal its secrets to a stranger. Santiago says that the desert told him its secrets because his eyes are fresh, and he can see things that others might take for granted.
Santiago is told that men of the oasis will arm themselves. Because of sand's tendency to ruin firearms, though, if at least one gun isn't used by sundown the next day, a gun will be used on Santiago. Still, Santiago remains relieved that he shared his vision.
The trees at the oasis are date palms — that is, fruit-bearing trees. This hints at the fact that Santiago's stay at the oasis will be fruitful — which, in fact, it turns out to be.
Readers may think that the important man the alchemist refers to is the Englishman, since he is searching for the alchemist. The Englishman has studied alchemy for years and carried many books on the subject across the desert. But something about the alchemist's uncertainty suggests that the obvious candidate — the Englishman, with all of his books — will not be the alchemist's choice.
Up until now we have been thinking of Santiago as the shepherd boy. But Santiago has been steadily maturing over the course of his journey. A boy no longer, Santiago is the man to whom the alchemist will teach his secrets.
This sudden change in the novel's setting is physically and emotionally dramatic. Previously, the action took place in somewhat difficult terrain — the hilly pastures of Andalusia, the crowded, winding streets and alleyways of Tangier, and the unforgiving desert. Now the environment is benign, allowing the characters to focus on other concerns. They let down their guard, eat, drink (water or other nonalcoholic beverages, since Islam forbids drinking alcohol), and talk.
It is under these conditions, when Santiago is helping the Englishman search for the alchemist, with no thought to pursing his Personal Legend, that he first encounters Fatima — encounters, that is, love. Previously, Santiago's only concern was finding the hidden treasure. Suddenly he must take his heart into consideration.
Along with the old woman who interprets Santiago's dream, Fatima is one of two female characters in the novel. And it is significant that Fatima is one of the few characters in The Alchemist to be given a name. This indicates that she is important to the novel, despite appearing in it only briefly.
Also, the name Fatima was the name of the Muslim prophet Mohammed's daughter. A traditional Arabic good luck symbol shaped like a palm is known as "the Hand of Fatima." Fatima herself is a harbinger of good luck; she cheerily prods Santiago onward, encouraging him to fulfill his Personal Legend and leave the oasis to look for the hidden treasure.
Though he lives in their midst, the alchemist isn't particularly valued by the inhabitants of the oasis. His position mirrors that of other important historical figures, including Jesus, a carpenter's son who wasn't recognized as especially important by many in his own community.
Santiago's vision of the two fighting hawks is extremely significant. Hawks are birds of prey that usually attack other, smaller birds. It is rare for hawks to attack one another. Likewise, it is unusual for an army to invade the peaceful refuge of the oasis. But this is exactly what will happen.
When Santiago visits the tribal chieftain's tent, it is huge and white; the chieftain himself is wearing gold and white robes, as is his son, the young Arab who first brings Santiago into the tent. White is the color of purity, and gold is the most valued metal and the color that represents wealth. Therefore, we are meant to recognize that the tribal chieftain is not just rich, as Santiago discovers when he enters the tent, but pure — incorruptible. The meeting of white and gold may also symbolize and foreshadow the meeting of Santiago, who is pure, and the alchemist, who can turn lead into gold.