Digamma Pi holds an annual dance, which Martin attends with Leora. At first, Martin feels bad for Leora and somewhat embarrassed that no one is asking her to dance. However, eventually Fatty Pfaff appears and asks Leora to dance. Other dance partners follow, and Martin becomes jealous. Leora chides him for his jealousy and reassures him that she loves only him.
After the party, they go to the cafeteria and are joined by Martin's friends. Clif, who had hated Madeleine, likes Leora. Also while at the cafeteria, Martin approaches Angus Duer and congratulates him for getting Sigma Xi. Angus acts in an aloof manner, which disturbs Martin for the rest of the night. The next day, however, Angus apologizes and claims that he had a headache and was sorry if he was rude, afterwards proceeding to invite Martin and Leora to a play. He asks if Leora could bring a friend since he has four tickets.
Leora agrees to go and brings her friend Nelly Byers. After the play, both Leora and Nelly have to be back at the hospital early, but whereas Nelly returns on time, Leora says she will stay a while longer with the boys and sneak in later. All the while, Angus studies Leora along with the exchanges between her and Martin. When Leora finally goes back to work, she sneaks in, and Martin goes in after her, despite the danger of being caught. Surprisingly, Angus is still waiting for Martin outside (sleeping). The watchman has seen Martin leaving the building. After almost being caught by the police and after Angus has gotten condescendingly violent with the watchman, Martin is able to salvage their situation and escape with Angus. Martin believes that Angus will show friendship for having saved him from his violence but instead Angus turns the situation around and, the next morning, tells Martin that he better stop drinking if he cannot handle his alcohol.
Martin continues to work for Gottlieb and occasionally even visits the old professor in his cottage. He also begins to gain a liking for "Dad Silva", the professor of internal medicine and also the dean of the faculty. At the same time, Martin despises Dr. Roscoe Geake the professor of Otolaryngology whom he calls a "peddler" and who is about to leave the university to accept a job as Vice President of the New Idea Medical Instrument and Furnishing company.
Leora has to go back to Dakota because her mother has taken ill, and Martin misses her terribly. He begins to complain about work and his feelings of loneliness without Leora. He has stayed on with Gottlieb to work through his winter vacation, after exams, and Gottlieb is being terribly hard on him. He feels overwhelmed by all of this and takes to drinking. The only person who is also around for vacation is Clif Clawson, and Martin takes refuge in him until the incident at Founder's Day.
Founder's Day is the school's celebration of the founder's birthday, and there are speakers and wine—everyone is expected to attend. Dr. Benoni Carr has been invited to speak, but he shows up for the occasion completely drunk. This incident turns out to be mostly the fault of Clif Clawson who had met the man while they were both drunk and had told Dean Silva that Carr was a celebrated pharmacologist who had just returned from Europe (which was, of course, not the whole truth) and who should be invited to Founder's Day.