On the seacoast, Sebastian is despairing over his fortune. He asks Antonio to leave him so that his misfortune doesn’t affect him. Antonio is the one who saved him from breaking waves. Antonio decides to see Sebastian in Orsino’s court even though he has many enemies there.
Malvolio catches Viola on a street and tries to return the ring which Countess Olivia gave him to do so. He threw it on the ground to force her to pick it up anyway. Viola gave no ring to Olivia so she guesses that Olivia has fallen in love with Viola’s disguise Cesario.
Viola wonders how this triangle will work out and how easy it is for something false to impress a woman’s, soft heart. In the end, she sighs that it is only time that can solve this complication.
Sir Toby and Sir Andrew are fooling around each other. Feste arrives and both of them make fun of him and ask him to sing a song. Feste sings a love song. Sit Toby decides to sing a catchy song which means all three of them will sing one after another after the same interval.
Maria enters and warns them against making such noise. Malvolio enters and scolds them for their misbehaviors. He warns Sir Toby specifically to which he famously replies that do you think just because you are virtuous there shall be no more cakes and ale.
All of them start pulling the leg of Malvolio and he leaves angrily. Maria, Sir Toby, and Sir Andrew decide to take revenge against Malvolio by making a fool out of him. Maria plans how to make him believe that Olivia loves him by writing a letter to him in the handwriting of Olivia.
Orsino is listening to music in the thoughts of Olivia. When Viola enters, he tells her about the nature of love. Viola smartly hints to Orsino about the one she loves but as Cesario, she can only talk about it like a man.
Feste is brought into the house by Curio and he starts singing about separation and true love. Once all of them leave, Viola (as Cesario) delivers the details from Olivia’s side to which Orsino stubbornly denies because he claims that his immense love for her cannot go unanswered. He declares that his love can give no place to any denial.
In Olivia’s garden, Sir Toby, Sir Andrew, and Fabian are planning about the revenge against Malvolio. They hide behind the shrubs to see Malvolio foolishly reacting to the fake letter written to him.
They watch his foolish arrogance about why Olivia must have fallen for her. He is completely fooled by the letter which was deliberately thrown on the ground earlier to be picked by him.
He safely assumes that the love letter is from Olivia and surely intended for him. After he leaves, the rest of them come out and praise the device set by Maria. They decide to wait and watch the fun to be unfolded by Malvolio’s future behaviors towards Olivia.