Near Olivia’s house, Feste the clown comes across the person who he thinks is Cesario and attempts to bring him to Olivia’s house. But it actually is actually Viola’s twin brother, Sebastian. Sebastian, of course, is confused by Feste’s claims to know him.
Sir Toby and Sir Andrew then find them. Sir Andrew, thinking that Sebastian is the same person he was about to duel a few minutes before, he then attacks him.
Sebastian, unlike Viola, is a scrappy fighter, and starts to beat Sir Andrew with his dagger, leading the foolish nobleman to cry for mercy. The bewildered Sebastian wonders if he is surrounded by madmen and tries to leave. But Sir Toby grabs him to prevent him from going.
The two exchange insults, and Sebastian and Sir Toby draw their swords and prepare to fight.
Suddenly, Olivia enters. She sees Sir Toby preparing to fight the person who she thinks is Cesario. Angrily, she orders Sir Toby to put away his sword and sends away all the others. She begs Cesario to come into her house with her.
Sebastian is bewildered, but Olivia does not give him time to think, and the still-confused Sebastian agrees to follow her, saying, “If it be thus to dream, still let me sleep!”