At Chesney Wold, the Dedlocks' estate in Lincolnshire, the rain continues. The old housekeeper, Mrs. Rouncewell, is assisted in her duties by Rosa, with whom Mrs. Rouncewell's grandson, Watt, is in love. Two visitors are admitted and given a tour of the house. One of them is Mr. Guppy, a law clerk at Kenge and Carboy. Mr. Guppy notices a portrait of Lady Dedlock and is sure that he has seen it before. When Guppy and his companion leave, Mrs. Rouncewell tells Watt and Rosa the story of The Ghost's Walk. In Oliver Cromwell's era (two centuries earlier), Sir Morbury Dedlock's wife once lamed some horses intended for the Cavaliers fighting against Cromwell. When her husband spied her slipping out to lame his favorite horse, they fought in the stall, and she suffered such a severe hip injury that she was painfully lame for the rest of her life.
One day, while limping on the terrace of the Dedlock estate, she fell and died, vowing to haunt the terrace until "the pride of this house is humbled." Mrs. Rouncewell tells Watt to start the tall French clock. He does so, but above its loud beat and the music it plays, he can still hear the footsteps of the ghost.
The gloomy rain at Chesney Wold, the mystery of Guppy's reaction to Lady Dedlock's portrait, and the story of The Ghost's Walk enhance the reader's sense that misfortune is in store for the Dedlocks — and perhaps for others.