Myra and her husband Oswald return to their fictional hometown of Parthia, Illinois, to visit their relatives. Nellie and Aunt Lydia then leave to spend the Christmas holiday in New York City with them. They live on Madison Square. They dine with Ewan Gray, a friend who has an infatuation with another actress, Esther Sinclair. Oswald receives silver-buttons for his shirt from an old Western acquaintance, and asks Lydia to pretend she gave them to him to thwart his wife's jealousy. Later Myra and Nellie go to the opera; in a lodge they spot an erstwhile friend of Myra's, which makes her sad. Later they take a hansom around a park and chance upon a rich acquaintance of Myra's, which leads her to be scornful over her own poverty. They spend Christmas dinner with friends of the Henshawes - both artists and people of privilege. Later they spend New Year's Eve with artists again. A few days later Nellie witnesses the Henshawes argue; the husband takes her out to lunch. Soon after, she and her aunt are to return to Illinois. On the train, they are joined by Myra, who has argued with her husband again and is going to visit a friend in Pittsburgh for a change of scenery.
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