Don Quixote finds the man who they met on the road earlier carrying the arms. He helps him finish his chores so he is at liberty to tell his tale.
The man tells the tale. In another village, a regidor lost his donkey through the fault of his servant girl. He could not find it. Eventually, someone comes up to him and tells him he saw the donkey in the forest. He tried to catch it, but it ran away. He offers to accompany the regidor to the forest to search for it. The regidor is grateful.
They go to the forest, but they cannot find the donkey. The other man tells the owner that he can bray very well, and this is certain to draw out the donkey. The owner praises the braying of the other, which sounds like a donkey. However, his donkey doesn't respond to the cry. They find him dead in the forest, devoured by wolves.
They return to the village. The owner praises the braying of the other man to his village folks. Unfortunately, this causes other people in other villages to make fun of the people in this town--and they bray whenever they come across someone from this village. Anyway, the town has decided to battle with another village who is bad about persecuting them--and that is why he is carrying the arms.
man arrives at the inn, called Master Peter. The landlord greets him warmly. The man wears a patch over his face. He is a famous puppeteer and showman. He has an ape that tells him the answers to any question posed to him from the audience.
Don Quixote poses a question about the future. The man says the ape can only answer questions about the past or present. He knows nothing of the future.
Sancho claims he wouldn’t pay to hear the future or to hear what he alredy knows. He asks the monkey what his wife is doing now—and how she is enjoying herself. The monkey whispers to Master Peter, and the man falls upon his knees before Don Quixote—calling him a celebrated knight. Everyone is astounded. Master Peter assures Sancho that Teresa is well and happily going about her chores.
The puppeteer performs a show. Don Quixotes believes that Peter has made a pact with the devil, for an ape shouldn’t divine the past or present. That he can’t divine the future shows it is the devil’s work, for only God can know what is to come.
Sancho wants Don Quixote to ask the ape whether what happened in the cave is true. Master Peter says the ape replied it was part false and part true. His powers are exhausted now. He’ll answer more questions on Friday.