The innkeeper, who is standing at the door, greets some newly arrived strangers. The man and woman, heavily veiled for traveling, are accompanied by two retainers. The lady does not say a word; she seems overcome by a profound grief. Dorothea strives to comfort her, and she is struck by the beauty of the maiden although her face is pale and sad. The gentleman also removes his veil, and with a cry, Dorothea recognizes her husband, Don Ferdinand. The lady, of course, is Lucinda, and she and Cardenio are tenderly reunited. Don Ferdinand, so moved by lovely Dorothea's love for him, claims her as his true wife and swears to be faithful. Everyone who witnesses these tender scenes weeps with joy.
Sancho Panza is horrified to discover that Princess Micomicona is now merely called Dorothea. He fears that he will never gain his earldom. Running straight to his master, Sancho informs him of the trick, but Don Quixote merely cautions his squire against being taken in by all the enchantments that occur in this castle. Ferdinand, meanwhile, encourages Dorothea to continue with her deception until the curate and barber have safely conducted the madman to his home. More newcomers arrive at the inn now. The man, having returned from imprisonment in Barbary, is still in Moorish dress. Accompanying him is his betrothed, a beautiful "Morisca" named Zoraida who wishes to become a Christian. As they all sit down to dine, a mood of expansive oratory overcomes Don Quixote, just as happened among the goatherds. His speech this time compares the professions of arms and learning, and he discusses the privations and rewards of soldiers and scholars.
Don Quixote shows that it is the soldier who suffers the most privations, receiving in return lesser compensation, especially when one considers that he may not live to enjoy the rewards of his service. The man of letters, on the other hand, is guaranteed of life, and his scholarship will gain him a career with professional status. The more noble following, Don Quixote concludes, is, however, that of the soldier. Dinner being over, the entire company begs the captive for his life story.
He tells them of his father, a ne'er-do-well whose extravagance almost left his children without any means. He and his brother joined the army and fought victoriously in a great naval battle against the Turks. He relates how he was captured by the captain of a corsair, thus beginning a long imprisonment. The captive goes on to describe the battles he witnessed and the particular bravery of a man named Pedro de Aguilar, who Don Ferdinand recognizes as his brother.
The fleet for which he was a galley slave returned victorious to Algiers, and his work was changed. Upon the death of his master, the captive became the property of the most bloodthirsty Dey of Algiers, a renegade named Hussan Aga. He was placed in a special prison house, called a bagnio, reserved for Christians whose rich connections will soon provide a ransom, although he had no claim to this distinction other than having the title of captain. Overlooking the bagnio's courtyard were the windows of a high-ranking Moor, whose beautiful daughter, secretly a Christian, made clandestine communication with him. She sent the captive money enclosed in a note that told him of her desire to escape to a Christian land if he would arrange to free himself and take her to Spain. The letter was written in Arabic, and the captain engaged a renegade to translate it. Many other messages were exchanged between Zoraida and the captive until enough money was collected to furnish a ship and ransom other bagnio captives besides himself.