Inside, the company finds that the boys have just finished the sacrifice and are playing dice in the Apodyterium (an undressing room), with Lysis looking on. The men go and sit in an opposite corner of the room; Lysis looks interested, but doesn't actually come over to them until his friend Menexenus does. Hippothales stands out of view and listens, "lest he should anger [Lysis]" with his persistent presence.
Socrates opens the conversation with a few teasing questions as to whether Lysis or Menexenus is the older and which is the nobler, both of which are "matters of dispute" between the two). Socrates also asks who is the fairer, and at this the boys just laugh. Then Menexenus is called away to finish up some sacrificial duties, and the conversation with Lysis begins in earnest.
Now the dialogue takes the elenchus form, with Socrates asking long, sometimes disingenuous questions, and Lysis answering with short affirmations as he digs himself into an increasingly unsettling position. The issue is whether Lysis's parents keep him "in the condition of a slave." Socrates argues that they do (even while Socrates pretends to be shocked that this is the case): Lysis is not allowed to drive the chariot or even the mule cart, but the family's slaves are; Lysis's "master" (his tutor) is a slave, and so on.
Lysis is unfazed, and often laughs in delight at Socrates's crazy but apparently unassailable arguments. Finally Lysis replies that his parents treat him as a "slave" because he is not yet of age. Socrates then argues that Lysis is allowed to do many important things (read and write for the family, tune the lyre) even though he's young. Lysis then asks why his parents restrict his actions not because of his age, but because of his understanding (for example, he understands how to read and play the lyre, but not how to drive a chariot). This, of course, is what Socrates was getting at all along: "Yes, my dear youth the reason is not any deficiency of years, but a deficiency of knowledge."
Socrates takes this crucial point and extrapolates it, asking Lysis if not only his parents but his neighbors, the Athenian people, and even the king of Asia would grant him some degree of control if he was the wisest. The neighbor would commit the affairs of his house to Lysis if Lysis knew more about them than the neighbor, and so would the Athenian people. The "great king" would allow Lysis (rather than even the king's own son, the prince) to cook for him if Lysis was the better cook, and would even entrust the prince's vision to Lysis if Lysis knew how to heal eyes.
In short, everyone—"Hellenes and barbarians, men and women"—will trust Lysis in things that he understands: "these things will really be ours, for we shall turn them to our good." The opposite is true as well: even close friends will "hinder" us in matters we do not understand. In fact, if we have no wisdom, we will have no friends and no one will love us (even our parents), because we will be of no use to them.
Lysis agrees to all of Socrates's statements, and Socrates wraps up this line of questioning by confirming that Lysis has no wisdom yet on the basis that Lysis "requires" a teacher. With no wisdom, Socrates continues, Lysis can neither have "high thoughts" nor be conceited. Again, Lysis agrees. At this, Socrates nearly calls out to Hippothales to take note of how, instead of flattering Lysis—instead of making Lysis into a conceited, unattainable beloved—Socrates has humbled Lysis into needing a teacher. But Socrates sees that Hippothales has heard the conversation and that he is in "great excitement and confusion," so Socrates allows him to stay hidden.
At the outset, we should note the change of setting and its implications. From a chance encounter on the street (the most common setting for the dialogues), Socrates and his friends have moved into the very heart of a complex social institution, a Hermetic rite in a local temple. Social strictures, divisions, and customs are very much in play here, and our main characters have to do some maneuvering to get to the point where Socrates can speak to Lysis while Hippothales looks on.
Despite these machinations, however, Socrates's actions are clearly meant to be upstanding and socially flawless (though clever). We have already been reminded explicitly that this particular celebration entails "no separation between the men and the boys," and here we are told that the formal, sacrificial part of the festival "was nearly come to an end." In this way, Plato manages to avoid giving unseemly connotations to Socrates's luring of Lysis into a conversation, even as Plato frames the luring within the formal context of sacred, communal Athenian rites. The point is further reinforced by the otherwise puzzling addition and subtraction of Menexenus from this scene. Being bolder than Lysis, Menexenus is drawn over to the men first and serves as bait for his shyer friend. Then, after a few playful questions, he is called away by his gymnastics teacher to finish up his sacrificial obligations. Menexenus, then, though he serves no intellectual purpose and has no real role at this point in the dialogue, serves to reinforce the upright characteristics of both Lysis and Socrates. Lysis is shown to be the properly shy object of the affections of the men (see Lover in the Terms list), and Socrates is shown not to be hindering the boys from their civic obligations.
The first real exchange with Lysis is fairly straightforward. We might think of it as a kid's version of the standard Socratic interrogation, which aims to show that freedom and/or virtue depend on knowledge and not on social norms such as, in this case, the coming-of-age. Rather than appealing to abstract virtue, Socrates focuses on the stuff that will make Lysis interested in the conversation. For Lysis, the standard line is adjusted toward practical knowledge (chariot-driving, cooking, medicine) and "use" value. Again, however, it must be noted that Lysis's age is not the only thing making the dialogue here slightly unusual. He is also a beloved, and in this sense his age has a double signification: Lysis must be conversed with carefully not just because he is young, but also because his youth makes him an object of desire, an object to be carefully wooed.
Hiding behind his pillar and burning with love, Hippothales embodies the hidden vector of Socrates's dialogue with Lysis, the way the conversation is pulled in various directions not just by an age difference, but by desire. Thus, we can read the exchange about whether Lysis is slave or master to his parents as also an exchange about his control over his own desire (versus the desires of others). Further, we can read the conclusion—that what holds Lysis in "slavery" is lack of wisdom, not age—in the context of wisdom being bound up with erotic love in the ideal tutoring relationship.
In any case, Socrates himself makes it clear that he is maneuvering Lysis into a position of humble eagerness for a teacher, for someone to give him the wisdom that will in turn get him the tokens of power (his father's chariot, a place in the king's court) that Socrates has been dangling before his mind's eye. In short, Socrates has made Lysis humble enough to actively desire the advances of a knowledgeable older man, rather than be annoyed by such a man's constant flattery.