Lily awakens to find two messages at her bedside. She assumes both are related to her success from the previous evening. The first letter is from Selden, requesting to see her. She fears that Selden will once again propose marriage to her, but sends a reply consenting to meet him the following day. The second letter is from Judy, who also requests to see her that evening. The latter correspondence cheers Lily, because she misses her old friend.
When she arrives at the Trenor house that evening, she is led to Judy's study where Trenor is waiting to speak with her. He confesses to employing duplicity in arranging the meeting — Judy is not home that evening — which angers Lily. He implores her to listen to him, and blocks the doorway with a chair so that she cannot leave. He accuses her of intentionally making him look foolish as well as taking advantage of his better nature.
Lily appeals to Trenor's understanding of societal rules regarding a single woman visiting a man without a chaperone, but Trenor responds that he knows that she had visited Selden alone in his apartment. He tells her that he expects some type of repayment for the financial success he has brought to Lily, and she offers to repay him in kind. She also states that Trenor has done only what any true friend would do for another. He responds that he believes she must have accepted similar kindnesses from many other men. Following the insult, he tells Lily that he is "mad" about her.
As suddenly as he had become enraged, Trenor becomes resigned to Lily's diffidence. The narrator explains his reasons for dismissing Lily: "Old habits, old restraints, the hand of inherited order, plucked back the bewildered mind which passion had jolted from its ruts." She leaves and takes a hansom back home. On the way, she recognizes Gerty's apartment, and decides to pay Selden's cousin a visit.
The peaceful feeling Lily experiences upon awakening is quickly dispelled by the realities of her existence. The admiration and awe that she had inspired the previous evening is the fleeting appreciation accorded only to objects of art, and the following day's adventures bring Lily back to the mundane and sometimes painful reality of her life. She must once again contend with the romantic intentions of Selden, and worries that she may have to dispel the rumors of her relationship with Trenor to Judy.
Her mercenary treatment of Trenor prompts him to ambush her in his wife's study, where he alternately chastises and pleads with her for her attention. As a businessman, the only personal commodity he has to offer is of a monetary nature — he recognizes that he is neither physically attractive nor clever, and he has used his talent for earning money as a means by which to keep Lily in his orbit. His scheming to bring Lily into a private conference reveals him to be a totally pathetic individual, albeit one whom Lily used shamelessly to attain her own financial goals.
Lily's need to feel pure again leads her to stop at Gerty's apartment building. Lily desires to visit Gerty in order to receive her reassurances and compassion. The reader may also conclude that Wharton intends this scene to indicate that Lily may herself recognize that her social downfall is inevitable.