The narrative begins during a particularly "severe" winter, a period marked by the narrator's father's declining health, which leaves the burden of the inn solely upon the narrator and his mother. Amidst this domestic strain, the captain—a character previously established as an "unpleasant guest"—maintains his routine. On a cold January morning, a mysterious stranger arrives. Described as a "pale waxy man with two missing fingers," this individual immediately strikes the narrator as someone who, while not appearing as a typical sailor, possesses "something of the sea about him."
The stranger’s true intent is revealed when he inquires about "my pal Bill." Despite the narrator's attempt to deflect, the stranger confirms the captain's identity by citing his "deepest cut on his right cheek." The tension escalates as the stranger hides behind the door, waiting for the captain like a "cat for a mouse." When the captain returns, the encounter is explosive. Upon seeing the stranger, the captain gasps, "Black Dog," revealing the identity of the mysterious visitor. The dialogue confirms a dark shared history, with Black Dog gesturing to his "terrible hand" and the captain admitting, "you found me."
The private meeting quickly descends into chaos. The narrator, eavesdropping, hears "rude talk" that erupts into a physical struggle. Furniture is overturned as the captain chases Black Dog out of the inn with a "drawn sword." The violence leaves a lasting mark, quite literally, as the captain’s blade puts a "notch in the sign over our door that is there to this day." Though Black Dog escapes, the exertion proves too much for the captain, who collapses in a "bewildered state" before fainting.
When Dr. Livesey arrives to attend to the unconscious captain, he diagnoses the incident as a "stroke," delivered with his characteristic "matter-of-fact" tone. The medical examination leads to a significant discovery: the captain’s arm is covered in tattoos, including one featuring a man hanging from a noose with the inscription "Billy Bones." This moment marks the transition from the character being merely an "unpleasant guest" to a man with a dangerous past.
Dr. Livesey performs a bloodletting procedure to stabilize the patient, yet the captain’s first words upon waking are frantic, desperate inquiries: "Where is Black Dog?" The doctor sternly warns that while he has "saved your life," the captain is in a fragile state. The doctor leaves the inn with a dire prognosis: "One more stroke like that... and he would be finished for good." The chapter concludes with the captain confined to his bed, his secret identity exposed and his health hanging by a thread, leaving the household in a state of heightened anxiety regarding what other figures from the captain’s past might appear.