They meet Sir Madok de la Montaine, who is pursuing Sir Ossaise of Surluse for playing a trick on him (both are missionaries for the Yankee). He continues on his way, and they find one of the old prisoners at the edge of a town surrounded by his family. The Yankee observes how nothing shocks these people except kindness and that their lives consist of a monotonous, uncomplaining acceptance of oppression. He realizes the peaceful revolution he has planned is doomed to failure, and he is unwilling to lead a violent uprising. They come to the ogres' castle, which turns out to be merely a pigsty watched over by three swineherds. Sandy insists it has been enchanted and only appears to be a pigsty to the Yankee, but she can still see its true form. The Yankee humors her and buys all the hogs from the swineherds and releases them.
Sandy rushes over and embraces them as noble ladies, to the Yankee's disgust. They drive the hogs with much trouble to a house ten miles away, and Sandy insists the whole way that they be treated according to their noble station. When they arrive, the hogs are taken into the house as guests, and servants are sent to find the missing ones. The Yankee realizes Sandy is not a lunatic; she has been brought up to believe in sorcery and enchantment. He realizes he would be taken as a lunatic if he spoke openly about the environment in which he was raised. The next morning, Sandy serves the hogs their breakfast at the head table, while she and the Yankee (being of lower station) eat at the second table. Sandy tells the Yankee the "ladies" should remain at the house for their friends from distant lands to arrive and take them home, and the Yankee secretly gives them away to the servants.
They leave the house together, as Sandy is bound by honor to stay with her knight until he is defeated in combat. They join a procession of merry pilgrims bound for the Valley of Holiness. Sandy tells how the monks there never wash, because God caused their holy stream to dry up for a year and a day after the one time they did. They overtake a procession of slaves marching along solemnly in chains. The pilgrims watch as a young mother is flogged for her weariness and comment only on the skill with which the trader handles the whip. The Yankee refrains from freeing the slaves on the spot because he cannot risk earning a reputation for disregarding the law and the rights of citizens, but he resolves to end slavery if he can. The slave woman is delivered to her new master at a blacksmith's shop, where the chains can be removed, and she clings to her husband until they are separated by force.
The next day, they meet Sir Ozana Le Cure Hardy, another of the Yankee's missionary knights who specializes in nineteenth-century hats, who tells them the holy fountain of the Valley of Holiness has ceased to flow again. He says a messenger was sent to Camelot to get the Yankee to help, but he brought back Merlin when the Yankee could not be found. The Yankee writes a message to Clarence in Sir Ozana's hat and sends him to Camelot. The abbot is overjoyed to see the Yankee when he arrives at the Valley of Holiness and wants him to go straight to work, but the Yankee insists he cannot rightfully proceed until Merlin has finished trying. His respect for Merlin's professional rights is really just a front while he waits for his supplies to arrive from Camelot. The monks' spirits are raised considerably by his presence, and they spend a merry evening telling questionable anecdotes and singing songs.
The next day, the Yankee goes to the Holy Fountain--which turns out to be a simple well, as he had suspected--and finds Merlin there conjuring. He has some monks lower him into the well, and he sees that a fissure has formed, allowing the water to escape. There is plenty of water below the fissure, but the chain does not reach that far, and the monks have not had the presence of mind to send down a line to find it. The Yankee is a little disappointed at how simple the solution to the problem is as he was planning on using a dynamite bomb to reopen the well if he found it dry. The Yankee tells the abbot the miracle will be terribly difficult, but he thinks he can manage it. He goes around with Sandy to see the wide variety of holy hermits in the valley. Merlin tries the strongest enchantment he knows and then gives up, saying an evil spirit has possessed the well and can only be removed by speaking its name, an act that would mean certain death.
The Yankee steps in and declares there is still a slight possibility of success and has the area cleared. Two of his experts arrive and help him patch the well. They stow a load of fireworks in the well's chapel and then go to bed. The next day, Sunday, they make preparations for a flashy miracle. That night, the Yankee puts on a great show of exorcizing the demon with fireworks and a pump to send the water gushing out the chapel door before the multitude. There is much rejoicing among the multitudes; Merlin faints when the Yankee pronounces the demon's 'name,' which is just gibberish. The Yankee shows the monks how to work the pump, which they regard as miraculous in itself, and leaves the people exulting in the gushing water. He spends the night in rapturous excitement over his achievement.
The Yankee's language incorporates some archaic vocabulary here and there, although more in the narrative than in his dialogue (the beginning of chapter 20, for example). The Yankee wants to rid himself of Sandy in this section, but she is bound by honor to stay with him until he is defeated by another knight. He considers the possibility of letting himself be defeated just to rid himself of her constant chatter. Later in the section, she makes him realize that he can be annoying, too, with his constant use of nineteenth-century phrases that she doesn't understand. She tries her best to adapt to his way of speaking, but he hasn't been very understanding up till now. He sees his fault and repents, and their relationship is strengthened as a result.
The Yankee touches on the subject of sham miracles in this section, both Merlin's and the Church's (specifically the healing powers of the holy fountain). He says both reputations are based on miracles that took place while no one else was watching. The Yankee is disgusted by the people's unquestioning belief in enchantment and superstition (even though it has benefited him greatly). He is especially ashamed of Sandy and her delusion that the hogs are noble ladies. After consideration, he realizes that Sandy is not a lunatic; she has just been raised to believe in the possibility of such absurdities. The servants of the house they take the pigs to also seem taken in by the delusion, even after the Yankee gives the pigs away to them, since they insist on behaving as if the pigs really are nobles by refusing to clean up after them as animals.