Unknown to Madeline, Ralph and Gride have come upon some important information about her. Meanwhile, Smike falls ill after escaping from Squeers.

It’s pistols at dawn as a duel to the death takes place, and Nicholas interrupts the marriage of his beloved with equally tragic consequences.

Ralph and Squeers conspire one final time to steal Madeline’s inheritance papers as Smike takes a turn for the worse.

Noggs and Cheeryble come to Nicholas’s and Madeline’s aid as Squeers and Ralph finally get their comeuppance and the secret of Smike's parentage is revealed.