Polonius is advising Reynaldo regarding his upcoming visit to Laertes. He wants him to spy on Laertes behaviour in a foreign land. He expresses all his fatherly concerns to Reynaldo.
Ophelia enters the scene to inform Polonius regarding Hamlet’s recent mad temperament in front of her. Polonius overreacts sharply to this and takes her to the king in order to inform him of this so that it doesn’t become more dangerous in the future.
King is inquiring Rosencrantz and Guildenstern about Hamlet because they’ve been his friends since their much younger days. Both of them studied together with Hamlet. Queen Gertrude asks them to go and meet Hamlet.
Polonius enters and declares to the king that he has found the source of Hamlet’s madness. Voltemand and Cornelius enter and inform the king about the resolve with the king of Norway and leave.
After they leave, Polonius reads the letter given by Hamlet to Ophelia and further intensifies his point that his one-sided advances towards Ophelia is the source of his madness. Hamlet enters reading and Polonius comes across him and they converse spitefully.
Rosencrantz and Guildenstern enter and Hamlet talks about the nature of the world, dreams and ambition. He notices that they’re spying on the behalf of the king and the queen. They inform him of the group of actors who have arrived at Elsinore. Hamlet welcomes them.
Polonius comes briefly and advices them on the nature of acting. Hamlet asks those actors to enact the speech from the Trojan war regarding the slaughter of Priam. After their recital, Hamlet asks them to stage a play called The Murder of Gonzago.
Hamlet indirectly expresses his helplessness towards the revenge he wants to take and how this play will simulate the betrayal of his uncle to his father. During the staging of this play, he plans to observe his uncle and the mark of conscience on his face while watching something which re-enacts his crime closely.