Surprised by Euthyphro's willingness to prosecute his father on so questionable a charge, Socrates remarks that Euthyphro must have a very exact understanding of religious matters to proceed in such a way. Euthyphro proudly claims that he is an expert in all religious matters, and that this is what differentiates him from the common man. In response to this claim, Socrates suggests that perhaps Euthyphro could teach him about religious matters. That way, if Meletus were to prosecute him, Socrates could say that he is now under the tutelage of Euthyphro, whose authority on these matters is unquestionable. If Meletus were to prosecute him even so, Socrates could point out that Euthyphro is in fact the one responsible for teaching him and that Meletus should prosecute Euthyphro instead. Euthyphro encourages this suggestion, pointing out that with his expertise in religious matters, Meletus' claims could not stand up long against Socrates in court.
Socrates insists that Euthyphro begin to instruct him regarding what is holy and what is unholy. Socrates has Euthyphro agree with him that there must be one form or standard by which everything holy is holy and everything unholy, by contrast with the holy, is unholy. That is, all holy deeds must be holy by virtue of some feature or other that all holy deeds share in common. Socrates asks Euthyphro what this feature is.
Euthyphro suggests that prosecuting those who commit injustices is holy, and not prosecuting them is unholy. Here, Euthyphro appeals to two Greek myths, noting that Zeus imprisoned his father, Kronos, and that Kronos castrated his father, Uranus. Zeus is the best and most just of all the gods, and so if he behaves rightly in imprisoning his father for injustice, Euthyphro should be lauded for following this example.
Socrates is somewhat surprised by Euthyphro's example, and asks him if he believes literally all the myths about the gods--that they quarrel and have great battles as is depicted in Greek art and told in the stories of Homer and Hesiod. Euthyphro confirms that he believes all this and more. He says that his knowledge of divine matters is such that he could teach Socrates a great deal that Socrates did not know about the gods.
Socrates suggests that perhaps that can wait for another time. His present concern is with the definition of holiness, which he feels Euthyphro has not yet properly dealt with. That one should prosecute those who commit injustices is holy is merely an example of a holy act, and not a definition of holiness itself. Euthyphro concedes that there are a great many holy deeds that do not consist in prosecuting a religious offender. Socrates then urges Euthyphro to give a more general definition and to identify a standard by which all holy deeds can be recognized as holy.
Socrates is clearly setting up Euthyphro in a very characteristic manner. There is an obvious touch of irony (evident to all but Euthyphro, presumably) in the way Socrates praises Euthyphro's knowledge of divine matters and asks to be taught by him. He does not actually expect to learn from Euthyphro, but rather intends to lead Euthyphro out of his false confidence in his supposed knowledge and toward a wiser and more humble acknowledgment of his own ignorance. Socrates' method is not to tell Euthyphro that he is mistaken in claiming to be an expert on religious matters, but rather to show him through questioning. By asking for a general definition of what is holy, Socrates will show that Euthyphro has no such understanding at all.