Preoccupied by his love for Daisy, Gatsby calls off his parties, which were primarily a means to lure Daisy. He also fires his servants to prevent gossip and replaces them with shady individuals connected to Meyer Wolfsheim.
On the hottest day of the summer, Nick takes the train to East Egg for lunch at the house of Tom and Daisy. He finds Gatsby and Jordan Baker there as well. When the nurse brings in Daisy’s baby girl, Gatsby is stunned and can hardly believe that the child is real. For her part, Daisy seems almost uninterested in her child. During the awkward afternoon, Gatsby and Daisy cannot hide their love for one another. Complaining of her boredom, Daisy asks Gatsby if he wants to go into the city. Gatsby stares at her passionately, and Tom becomes certain of their feelings for each other.
Itching for a confrontation, Tom seizes upon Daisy’s suggestion that they should all go to New York together. Nick rides with Jordan and Tom in Gatsby’s car, and Gatsby and Daisy ride together in Tom’s car. Stopping for gas at Wilson’s garage, Nick, Tom, and Jordan learn that Wilson has discovered his wife’s infidelity—though not the identity of her lover—and plans to move her to the West. Under the brooding eyes of Doctor T. J. Eckleburg, Nick perceives that Tom and Wilson are in the same position.
In the oppressive New York City heat, the group decides to take a suite at the Plaza Hotel. Tom initiates his planned confrontation with Gatsby by mocking his habit of calling people “old sport.” He accuses Gatsby of lying about having attended Oxford. Gatsby responds that he did attend Oxford—for five months, in an army program following the war. Tom asks Gatsby about his intentions for Daisy, and Gatsby replies that Daisy loves him, not Tom. Tom claims that he and Daisy have a history that Gatsby could not possibly understand. He then accuses Gatsby of running a bootlegging operation. Daisy, in love with Gatsby earlier in the afternoon, feels herself moving closer and closer to Tom as she observes the quarrel. Realizing he has bested Gatsby, Tom sends Daisy back to Long Island with Gatsby to prove Gatsby’s inability to hurt him. As the row quiets down, Nick realizes that it is his thirtieth birthday.
Driving back to Long Island, Nick, Tom, and Jordan discover a frightening scene on the border of the valley of ashes. Someone has been fatally hit by an automobile. Michaelis, a Greek man who runs the restaurant next to Wilson’s garage, tells them that Myrtle was the victim—a car coming from New York City struck her, paused, then sped away. Nick realizes that Myrtle must have been hit by Gatsby and Daisy, driving back from the city in Gatsby’s big yellow automobile. Tom thinks that Wilson will remember the yellow car from that afternoon. He also assumes that Gatsby was the driver.
Back at Tom’s house, Nick waits outside and finds Gatsby hiding in the bushes. Gatsby says that he has been waiting there in order to make sure that Tom did not hurt Daisy. He tells Nick that Daisy was driving when the car struck Myrtle, but that he himself will take the blame. Still worried about Daisy, Gatsby sends Nick to check on her. Nick finds Tom and Daisy eating cold fried chicken and talking. They have reconciled their differences, and Nick leaves Gatsby standing alone in the moonlight.
Chapter 7 brings the conflict between Tom and Gatsby into the open, and their confrontation over Daisy brings to the surface troubling aspects of both characters. Throughout the previous chapters, hints have been accumulating about Gatsby’s criminal activity. Research into the matter confirms Tom’s suspicions, and he wields his knowledge of Gatsby’s illegal activities in front of everyone to disgrace him. Likewise, Tom’s sexism and hypocrisy become clearer and more obtrusive during the course of the confrontation. He has no moral qualms about his own extramarital affairs, but when faced with his wife’s infidelity, he assumes the position of outraged victim.
The importance of time and the past manifests itself in the confrontation between Gatsby and Tom. Gatsby’s obsession with recovering a blissful past compels him to order Daisy to tell Tom that she has never loved him. Gatsby needs to know that she has always loved him, that she has always been emotionally loyal to him. Similarly, pleading with Daisy, Tom invokes their intimate personal history to remind her that she has had feelings for him; by controlling the past, Tom eradicates Gatsby’s vision of the future. That Tom feels secure enough to send Daisy back to East Egg with Gatsby confirms Nick’s observation that Gatsby’s dream is dead.
Gatsby’s decision to take the blame for Daisy demonstrates the deep love he still feels for her and illustrates the basic nobility that defines his character. Disregarding her almost capricious lack of concern for him, Gatsby sacrifices himself for Daisy. The image of a pitiable Gatsby keeping watch outside her house while she and Tom sit comfortably within is an indelible image that both allows the reader to look past Gatsby’s criminality and functions as a moving metaphor for the love Gatsby feels toward Daisy. Nick’s parting from Gatsby at the end of this chapter parallels his first sighting of Gatsby at the end of Chapter 1. In both cases, Gatsby stands alone in the moonlight pining for Daisy. In the earlier instance, he stretches his arms out toward the green light across the water, optimistic about the future. In this instance, he has made it past the green light, onto the lawn of Daisy’s house, but his dream is gone forever.