Tom goes to school under Mr. Stelling for his first term. The experience is jolting to Tom—he is Mr. Stelling's only student and feels inadequate to the Latin and Euclid that Stelling attempts to teach him. Mr. Stelling, who considers Latin and Euclid the only measurements of intelligence and only methods of teaching, scolds Tom for his supposed laziness. Tom becomes "more like a girl than he had ever been in his life" as both his pride and sense of correctness in his previous way of life are diminished. He feels lonely—his only distraction being Mr. Selling's toddler, Laura—and he wishes for Maggie's presence.
Maggie comes for a visit before the end of term. Maggie condescendingly offers to help Tom with his studies and sits to study his Latin and Euclid, both of which take her longer to understand than she supposed. She impresses Mr. Stelling with her intelligent chatter but feels mortified by his allusion to her attempt to run away to the gypsies, and his comment that women have only "superficial cleverness" and are "quick and shallow." Tom is sad when Maggie leaves.
Tom goes home gratefully for Christmas at the end of the half-year, happy to see his familiar home. The narrator meditates upon one's affection for the worn furniture of childhood versus the impulse to acquire newer, nicer things.
Christmas at the Tullivers' is tense, as Mr. Tulliver is preoccupied with the problem of Mr. Pivart, a new landowner upriver who purports to use some of Mr. Tulliver's waterpower. Mr. Tulliver suspects that Lawyer Wakem supports Pivart and would represent him in future litigation. Mr. and Mrs. Moss are supportive of Tulliver at Christmas dinner, but Mrs. Tulliver begs him not to "go to law" and laments his stubbornness. Mr. Tulliver's lawyer, Gore, is less clever than Wakem, yet Mr. Tulliver is likely to go to law against Wakem, as he still bears a grudge over a suit that Wakem won against him, costing Tulliver his private right of road and the bridge. Additionally, Mr. Tulliver is goaded by the fact that he has been forced to borrow money from Wakem's office to repay Mrs. Glegg.
Tom has learned that Wakem's son will be sent to Mr. Stelling next term. Mr. Tulliver warns Tom not to be antagonistic toward Wakem's son despite his own grudge against Wakem, as the boy is a "poor deformed creatur."
Tom arrives back for his second half-year at school with Mr. Stelling, and a new student has arrived—Philip Wakem. Tom and Philip have their first meeting, and both boys are wary of each other—Tom because he knows Philip's father to be a bad man; Philip because he is afraid of being jeered at for his humpback. The ice is soon broken when Tom notices Philip's talent for drawing, and the conversation moves easier. Then Tom spontaneously asks Philip if he loves his father, and Philip defensively replies "yes." Tom is quite sure of his own father's righteousness, as well as the fact that Lawyer Wakem is evil, and his son must be bad, too, if he loves his father.
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