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Torvald tells Nora that debt is bad and he has a reputation to consider, and she needs to be careful about spending money before they have it.
Nora brags to Mrs. Linde that she borrowed money without her husband's knowledge, and taht by doing so she made the trip to Italy possible, which she claims saved his life, but confides that her husband must never know because he will be furious with her if he ever finds out.
Krogstad, who lent Nora the money, and works at the bank where her husband is going to be the new manager, threatens that if she doesn't use her influence with her husband to make sure he keeps his job, he will tell her husband about the loan, and the fact that Nora forged her father's signature, which is a crime.
Torvald explains to Nora that he must fire Krogstad, but that they have nothing to fear, and there is nothing that Krogstad can do to them because he has such a good reputation and his career has been above reproach. Nora is upset because she knows that Krogstad can hurt them, and wishes that Torvald would trust her... as she lies to him.
Dr. Rank confides to Nora that he knows that his chronic disease is worsening, and that he knows that he will be dying very soon. Nora tells him to cheer up so that she can talk about her problems.
Krogstad comes to tell Nora that since she failed to keep him his job he has written a letter to Torvald telling him everything, which he drops in the mail slot and leaves, just then Mrs. Linde enters and Nora tells her what Krogstad has done and that all is lost. Mrs. Linde goes to try to find Krogstad, but ends up leaving him a note that she wishes to talk to him.
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