In the tumult after the revelation of Ivanhoe's identity, as the name of the victorious knight spreads throughout the crowd, Prince John and his advisors hurriedly discuss the consequences of his reappearance. One problem is that John has granted Ivanhoe's castle to Sir Reginald Front-de-Boeuf. Maurice de Bracy and Waldemar Fitzurse insist that Front-de-Boeuf will have to vacate Ivanhoe's fiefdom. John suggests that perhaps his personal physician could "attend" the wounded knight, implying foul play, but Ivanhoe is already in the care of his friends. John's reverie is shattered when a messenger approaches with a hastily scrawled warning: "Take heed to yourself, for the Devil is unchained." John assumes that this means Richard is on his way back to England and panics; Fitzurse begins thinking of plans. They decide to hurry the tournament to a conclusion, then rally John's supporters in preparation for the king's return.
The archery contest is the next order of the day. Here, a gallant yeoman named Locksley effortlessly defeats Hubert, the king's champion. Concerned about bolstering his support in the nation, John invites the Saxon nobles to his banquet that night. But at the banquet, held at the Castle of Ashby, the sophisticated Normans taunt the uncultured Saxons, provoking tensions between the two groups. To soothe the party, John has a goblet passed around, asking the Normans to drink to the Saxons and vice-versa. When his turn comes, Cedric, who has already refused to drink to Ivanhoe or to acknowledge him as his son, says that the only worthy Norman he can think of is King Richard. John blanches, but can do nothing but drink to his hated brother's name.
After the banquet, Fitzurse makes the round of the powerful nobles, seeking to bolster John's support. While walking, he runs into de Bracy, who has become infatuated with Rowena's beauty. John has a plan to marry Rowena to de Bracy, but de Bracy is impatient; he has concocted a plan to kidnap her and her party as they ride home from Ashby. Fitzurse thinks that he is a fool and attempts unsuccessfully to dissuade him from his endeavor.
Deep in the forest, the mysterious Black Knight who helped Ivanhoe win the tournament comes upon a hermitage. He asks the hermit, who names himself the Clerk of Compmanhurst, for directions. The two men get along, and when the friar produces a wineskin, they spend the rest of the day drinking and singing together in the forest.
In these chapters, Scott shifts the emphasis of the novel away from the heroes (Ivanhoe, Rowena, Rebecca, Cedric, the Black Knight) to the villains (Front-de-Boeuf, de Bracy, Fitzurse, Prince John), many of whose personalities are thoroughly laid out for the first time here. The villains are, by and large, a group of stock characters. Like other villains in nineteenth-century romances, they are evil through and through, and like most of the other characters in Ivanhoe, they undergo no development during the novel. Prince John is a weakling, a hypocrite, and a coward who loves the acclaim and attention he gains while sitting on the throne; Fitzurse, de Bracy, and Front-de-Boeuf are disloyal advisors who have tied their loyalty to John simply because they believe they will have a great deal of power should he become king of England. This romanticized view of medieval history has been fairly consistent throughout English literature (as in Shakespeare's ##King John# As with the character of Isaac, Scott relies on standard literary attitudes and types.
Another important development in these chapters is the continued foreshadowing of the impending appearance of Robin Hood: Locksley, the winner of the archery contest, should seem to the reader suspiciously like Robin, and the Clerk of Companhurst in the forest should seem suspiciously like Friar Tuck. At the time of Scott's writing, the Robin Hood legend had already been inscribed in English folklore for centuries; the long buildup to the eventual emergence of Robin Hood as a character in the story is done solely for the enjoyment of the reader, whose anticipation rises with each new instance of foreshadowing.