There were twenty-four dinner guests for Rachel's birthday, but most are unimportant. With a bit of wire, Franklin has made the Moonstone into a brooch for Rachel to wear. On Rachel's left at dinner is Mr. Candy, the Frizinghall doctor who entreats Rachel to let him take the diamond home and burn it in a scientific experiment. On Rachel's right is Mr. Murthwaite, an Indian explorer who does not speak much except to explain to Rachel that her life would be endangered in India if she brought the diamond there. The dinner conversation proceeds unusually awkwardly, as when Mr. Candy fails to comprehend that another guest, Mrs. Threadgall, speaks of her deceased husband. Through dinner, Godfrey speaks quietly of religion to a guest near him, and Franklin lets his foreign sides show through with whimsical, unreasonable comments to other guests. Franklin finally excuses himself to Mr. Candy by explaining that he has slept poorly since giving up tobacco.
After dinner, the Indians reappear outside with drums and juggling for the guests before Betteredge can dismiss them. Mr. Murthwaite startles the Indians by speaking to them in their own language, and they soon leave. Murthwaite explains to Franklin and Betteredge that the Indians are clearly high-caste Brahmins who are disguised as low-class jugglers. Murthwaite and Franklin agree that it is the Moonstone that has led them to sacrifice their caste. Murthwaite explains to Franklin that the Indians will undoubtedly kill for the Moonstone, which belongs in their idol. The men resolve to speak again with Lady Verinder the next day about disposing of the diamond and to let the dogs out in the yard overnight to guard the house.
After the dinner guests have left, Lady Verinder urges Rachel to lock up her diamond, but Rachel insists on keeping it in the Indian cabinet in her room for the evening. Godfrey and Franklin go up to bed together, and Godfrey urges the weary Franklin to take some brandy and water with him. Franklin orders the drink sent to his room instead.
Betteredge lies awake all night, but he hears no noise. The next morning, Penelope fetches him, screeching that the diamond is gone. Upstairs, Rachel confirms to him that "The Diamond is gone!" before retreating to her bedroom and locking the door. Franklin orders the house searched and tries to speak with Rachel, who refuses to see anyone. Franklin goes to Frizinghall to alert the police and order the arrest of the Indians.
Franklin returns to report that the Indians are innocent, as they had been held in jail all night for a minor offense. Superintendent Seegrave arrives and orders the servants questioned. The female servants indignantly crowd into Rachel's room, but Seegrave orders them downstairs, pointing out that they've already smeared the wet paint on the door. While Seegrave questions the household, Rachel refuses to see him, instead asking to see Franklin. The two meet outside, and Franklin seems astonished by their talk. Rachel returns in a tearful rage and still refuses to see Seegrave.
Seegrave questions Betteredge about the servants' characters, and Betteredge reveals nothing of Rosanna Spearman. Seegrave interviews them all again, and the servants become even more annoyed. Seegrave requests permission from Lady Verinder to search the servants' rooms, but she declines explaining it would be a betrayal. Betteredge steps in and offers his own keys, setting an example that the rest of the servants follow, though grudgingly.
Betteredge looks for Franklin in the library and sees Rosanna leaving the library. She explains that she was returning a ring Franklin had dropped upstairs. In the library, Franklin explains to Betteredge that he wants to telegram London requesting a "cleverer" investigator. He also reveals that Rosanna has acted strangely toward him and suspects that she might know something about the theft of the Moonstone. Betteredge searches for Rosanna, who has become ill and gone to her room. Penelope reminds Betteredge to be careful of Rosanna's feelings, as she is lovesick over Franklin.
Franklin and Seegrave ride to Frizinghall so that Seegrave can question the Indians and so that Franklin can send his telegram to London. The men return and report no success with the Indians, even with Murthwaite to translate.
With the introduction of the diamond into the Verinder household, a feeling of exoticness and danger emerges. The exoticness of the diamond and its background make the danger seem less real, as when Rachel is delighted to hear in England that her life would be in danger in India if she were there with the diamond. The diamond itself, as we saw in Chapter IX, gives off, exotically, a dark brightness ("It shone awfully out of the depths of its own brightness" in a sunless room). Betteredge's narrative encourages a mysterious understanding that the diamond has created an atmosphere of strangeness and danger in the household, manifested by his own uneasiness and the sinister quality of the dinner conversation.
Yet the exoticness and explicit danger of these chapters of the novel are not presented as emerging from the diamond alone. Murthwaite works as a catalyst between English and Indian culture to explain the danger inherent in the Moonstone's history. Murthwaite exists as a kind of English spy on Indian culture and territory. This status makes him seem somewhat sinister and certainly exotic.
Though the Moonstone inspires a sense of exoticness and danger, its symbolism also connects it to female sexuality—Rachel's sexuality specifically. The diamond is connected with female forces through the symbol of the (feminine) moon. The circumstances and consequences of the theft connect the stone to Rachel's sexuality. The theft is committed on the night of Rachel's eighteenth birthday, her coming-of-age. The strange dinner conversation on the night of the birthday—especially the conversation of Franklin Blake, who speaks of female infidelity and breeding bulls—is sexual in subtext. Finally, the diamond is stolen out of Rachel's bedroom during the night and produces an inexplicable change in her. Rachel seems moody and reticent, refusing to speak to everyone, most of all to Franklin Blake.
Once the crime is committed, the mystery plot splits into two threads. The remainder of the novel will concentrate both on finding the diamond's current whereabouts and also on reconstructing how, and by whom, the initial crime was committed. Superintendent Seegrave foolishly concentrates mainly on the first mystery, and it is not until Sergeant Cuff is called onto the case that much attention will be paid to reconstructing the initial crime. The rules of a mystery novel (in which things are often the opposite of what they seem to be) apply to the characteristics of the detectives themselves. Superintendent Seegrave is considered to be physically reassuring and have an air of confidence, yet his ineptitude will soon be revealed.
Seegrave arrives on the scene of the crime and decides to shut down the house for investigation, thus ensuring the country house as the setting in which all events will be contained. Part of the innovative quality of The Moonstone and sensation fiction generally is to depict strange events in normal places. Though the diamond itself, and its history, create a level of exoticness and danger, the crime and investigation will take place within the confines of the country house—an entirely English setting.
In these early chapters after the theft of the diamond, Rosanna Spearman emerges as the most suspicious character. Yet Betteredge's good-natured support and protection for her suggest her ultimate innocence. The Indians seem to represent the only other immediately suspicious characters.