Mrs. Alving relates to the Pastor that she eventually caught her husband trying to seduce their maid, Johanna. When he finally got his way with Johanna, Mrs. Alving was horrified and sent the seven-year-old Oswald abroad, so that he would not have to witness his father's debaucheries. She continued to maintain the Captain's reputation, however, especially in her letters to Oswald. She sent Johanna away with a large sum of money to keep her quiet. The memorial orphanage is another attempt to make sure that the truth will never come out. It is also a way for Mrs. Alving to purge herself of her former husband all of his money is going into the memorial orphanage; her son's inheritance will consist of her money only. The Pastor is shocked by Mrs. Alving's divulgences and apologizes for his opinions. He concedes that Mrs. Alving has had to endure a great deal.
Oswald returns from his walk and goes to help Regina prepare dinner. The Pastor confesses that it will be difficult to give a speech tomorrow in honor of Captain Alving, but he says that he must do it in order to avoid scandal. Suddenly, Mrs. Alving and the Pastor hear Regina call out from the kitchen, asking Oswald to let her go. They are horrified. Mrs. Alving says that it is ghosts. As they enter the dining room, she insists that the Pastor say nothing.
It is clear that Regina is the daughter of the Captain and Johanna. This extra-marital birth was, understandably, the last straw for Mrs. Alving. She tells the Pastor that once she caught them, she immediately took over complete control of all household affairs. Her entire life has been marked by this sort of control: control over her husband's reputation, keeping her husband home at night, keeping her son ignorant of his father's failings, keeping Regina ignorant of the identity of her real father.
Mrs. Alving makes two difficult decisions regarding her husband. The first is her decision to maintain his reputation. The second is her decision to completely protect Oswald from his father. These strategies are connected: her son could not remain ignorant of his father's faults if he had a bad public reputation. Yet her desire to keep up his reputation is also motivated by a desire to save her own reputation. If the marriage were viewed as a failure, she could potentially be seen as the cause; indeed, later in the play she blames herself for not being able to match Captain Alving's "joy of life," his verve and spirit. At the very least, she may feel guilty for having temporarily abandoned her husband.
Mrs. Alving goes to great lengths to keep Oswald in the dark about his father. She lies to him in her letters and she sends him away as soon as he is old enough to ask embarrassing questions. Just as she tries to be the perfect wife to her husband—sticking by him and enduring most of his faults, all the while improving his reputation—she tries to give Oswald a perfect pair of parents. The dangers of upholding such a fiction will be revealed later in the play.
The close of the first act is almost fantastical in nature. Oswald is flirting with Regina, just as Captain Alving flirted with Johanna. Although Oswald and Regina do not know that they are half-siblings, the knowledge of their close relationship causes Mrs. Alving and the Pastor to be severely shocked when they overhear Regina's cry that Oswald has tried to touch her. Mrs. Alving attributes Regina's cries to ghosts; indeed, Regina and Oswald are the children of a man who similarly tried to seduce a maid a generation earlier. Captain Alving's ghost seems to reveal itself through them. Once again, Mrs. Alving feels that she has lost control of the situation. Yet she does not scream or rush into the kitchen. Her first impulse is to tell the Pastor not to utter a word, to keep up appearances, just as she did the last time such a seduction was taking place.