There are many poeple at the New Year's feast. They all were celebrating and having a good time until...
Some Helpful People
I know what's up
The Green Knight interrupts the party to present a game where someone can cut off his head only if that same person will find him a year later and allow the Green Knight to chop his head back. Sir Gawain offers to take the place of King Arthur and join the game.
Green Knight Found
One year after the party, at the agreed time, Sir Gawain heads out to find the Green Knight because, even though he chopped off the Knight's head, he was still alive and Sir Gawain had to uphold his end of the game. He is worried but determined.
You're great except for when you break your promises.
Along the way, Sir Gawain finds a castle and asks them for help. The lord of the castle gives him food, directions, and shelter in return that whatever gifts Sir Gawain receives while he stays at the castle he would share them with the lord. The lord would then share whatever he brought home from hunting.
I hope he knows what he's getting into.
When Sir Gawain heads out again he is plagued with the guilt of not keeping his promise. At one point, he was given, by the lady of the castle, a green girdle that should supposedly keep him safe. He brings it with him figuring, if he's about to get his head cut off he could use some extra protection. He does end up finding the Green Knight.
Stop flinching. That's lame.
The Green Knight doesn't cut off Sir Gawain's head, though he does knick it. He says Sir Gawain deserves to live because of his bravery in coming to find the Knight. The Green Knight then reveals himself to be the lord of the castle Sir Gawain visited. He admonishes Sir Gawain for keeping the girdle. He does declare he understands why. They decide to make a tradition of spending every New Year's together.