Madame Merle returns to Rome a short time after Lord Warburton's departure. She immediately questions Isabel about Lord Warburton's departure, and threatens to ask Pansy what Isabel said to her. Suddenly Isabel is aware that Madame Merle "was a powerful agent in her destiny." Her interest, Isabel realized, was the same as that of Osmond. Suddenly, Isabel asks her what she has to do with the matter. Madame Merle answers, "Everything." Thus, Mrs. Touchett was right: Madame Merle had married her.
Madame Merle visits Osmond and tells him how horrid she was that morning, but she receives no sympathy from him. She hears from him that her friendship has become tedious. Even though Madame Merle has worked solely for Osmond's benefit, he still finds her a bore. Thus she wonders if she "has been so vile for nothing." She warns Osmond not to destroy such a precious object as Isabel.
Later, Mr. Rosier comes to visit Isabel. He tells her that he has sold some of his art collection and is now considerably wealthier, but Isabel explains that Osmond still wants Pansy to marry a nobleman. Rosier meets the Countess Gemini, who becomes his sympathetic spokesman.
A week later, Pansy tells Isabel that she is being sent back to the convent. Osmond thinks that she needs some time for meditation and solitude.
Sometime later, Isabel receives a letter from Gardencourt. Ralph Touchett is dying. She tells Osmond that she must go to him. Osmond responds that he doesn't believe that Ralph is dying and that there is no need for her to go. If she goes it will be "the most deliberate, the most calculated, opposition." Isabel is forced to tell her husband that his attitude is "malignant." Osmond explains that his only contentment in life comes from preserving appearances, especially maintaining the form of a successful marriage.
When the Countess hears that Osmond has forbidden Isabel to go to England, she feels it is time for her to speak. She tells Isabel that Osmond's first wife died childless and that Pansy is the daughter of Osmond and Madame Merle. They were lovers for six years, and when Pansy was born, she had to give up all claims to her. Furthermore, the Countess Gemini points out that Madame Merle brought Isabel and Osmond together so that Isabel could help Pansy. Upon hearing this disclosure, Isabel is determined to go to England.
Madame Merle had said earlier that she had high ambitions. To fulfill these, it is necessary for her daughter Pansy to make a great marriage. Consequently, when Lord Warburton leaves without proposing, Madame Merle drops her pose for a while and shows her true nature to Isabel. But Isabel is so astounded by Madame Merle's actions that she fails to perceive the true nature of things. Thus, when the Countess Gemini tells Isabel about Pansy's parentage, Isabel, upon reflection, is able to credit the entire story. She realizes all the horror of her position. Not only did Madame Merle marry her to Osmond, but she also made Isabel's fortune available to her ex-lover.
Madame Merle, however, is not so evil as Osmond. We see in their interview that he lacks perception for other people. At least Madame Merle recognizes the fine and precious qualities that Isabel possesses. She warns Osmond not to destroy these. On the contrary, he is intent upon destroying Isabel's better attributes.
It becomes completely clear that Osmond lives solely for the sake of forms and appearance. He hates Isabel but wants to present to the world the appearance of a happily married couple. Anything that touches on the distasteful is for him repugnant. His sense of taste is thus corrupt and evil. It denies all human values in favor of superficial appearance. Consequently, he will send his daughter off to the convent for no logical reason except to satisfy some malignant purpose of his own.
The Countess Gemini has always disliked her brother. She has found Isabel attractive from the very first. Thus, this easily accounts for her revelation about her own brother. James carefully motivated this scene by having Osmond be especially unpleasant to his sister; therefore she now gets her revenge.