Henry, Margaret, Gloucester, Beaufort, and Suffolk are hunting in Saint Albans. Beaufort and Gloucester bicker and Henry asks them to try to get along. The two speak privately and challenge each other to meet later that evening with swords to settle the argument for good. They pretend they were talking of hunting, while they threaten each other under their breath.
A commoner enters, telling of a miracle; a blind man just received his sight at Saint Albans' shrine. The king asks to see this miracle, and Simpcox is brought in. Henry asks him if he was blind and now can see; Simpcox says he was born blind and experienced a miracle. Beaufort asks if he is lame; Simpcox says he is, because he fell while climbing a tree. Gloucester asked him why he was climbing a tree while blind, but Simpcox explains he was very young at the time. Gloucester points at some robes and asks Simpcox to describe them; Simpcox says one is red, another green, yellow, black. He accuses Simpcox of being a liar, declaring that a man with restored sight might be able to see colors but wouldn't be able to name them. Gloucester determines to heal Simpcox's lameness and calls for a whip to be brought in. Simpcox says he can't stand unaided to be whipped, but after the first blow falls, Simpcox runs off. Gloucester orders him to be caught and whipped as he is paraded through a series of towns.
Buckingham arrives with reports of the arrest of the Duchess for having dealt with witches and conjurers, asking questions about the future of Henry and other lords. Buckingham presents a record of the questions and answers. Suffolk hears the spirit's answer that he will die at sea. Beaufort says quietly to Gloucester that they won't meet that evening to fight now that Gloucester is in trouble. Gloucester grudgingly yields to Beaufort. Gloucester tells the king that he has always done his best, and he is sorry about his wife's actions. He says he will banish her from his life for having dishonored him. The king says they will return to London the next day to deal with this business.
York talks with Salisbury and Warwick at his house. York wants to tell them about his claim to the throne. He explains that Edward III had seven sons. The eldest son died, leaving his son, Richard II, to become king. Richard ruled until the Duke of Lancaster, son of the fourth son of Edward III, deposed him and ordered him murdered and became Henry IV. Thus, the house of Lancaster illegally holds the throne. York explains that he is the heir of the third son of Edward III, part of the Mortimer line. Legally, the son of the elder son of Edward III should rule before the son of the younger son; since he is heir to Edward III's third son while Henry VI is heir to Edward III's fourth son, York should be the king.
Salisbury and Warwick are convinced and bow to York as England's true king. But York reminds them that he is not king yet. They must allow the other lords to continue on with their foolery until they bring down the honest and decent Gloucester. Then, prophecies York, the others will all bring about their own ends.
Gloucester sees through Simpcox's scheme, and as he flees, his wife says they did it only to make enough money to live. Gloucester may be the favorite of the people, but that doesn't stop him from revealing Simpcox's methods of creating an income. An example is made of Simpcox, as an example will be made of the Duchess when she is found guilty of her crimes.
York's explanation of his right to the throne demonstrates a fairly distant claim, based almost entirely on the idea that the deposition of Richard II was the real crime of the Lancasters. In Shakespeare's time, there was a prevalent belief that the disastrous violence of the French wars and the English civil wars all rooted originally in the unjust murder of the rightful king, Richard II, and the rule of usurpers thereafter. Therefore, to depose the Lancasters again in favor of the Yorks would set things right.