In the large lobby of the front hall as a orchestra plays a minuet in the background, George (with white gloves and a carnation in his buttonhole) stands with his mother (dressed in a gorgeous ball gown) in the reception line and greets everyone assuredly (but falsely): "I remember you very well indeed." He is quickly attracted to Lucy and instantly falls for her - carrying on the tradition of an attraction between a Morgan and an Amberson. George leaves the reception line and takes her arm-in-arm for a long stroll through the richly-decorated mansion toward the upstairs dancing hall in a long, gliding tracking shot (with deep focus perspective). The marvelously fluid tracking shot follows them across the entrance hall, up the oak stairs, past stained-glass windows, and down the long corridor of the second story.

On their way as they gracefully glide through the mansion elegantly enriched with Edwardian craftsmanship, George is unconscious of her father's identity. With characteristic stupidity, he foolishly insults Eugene, calling him "the queer looking guy" as Ludy's father talks to one of Major Amberson's two grown-up children, Hon. Uncle Jack Amberson, a Congressman. To impress Lucy, he tells her: "The family always liked to have someone in Congress." George is quickly offended by all the men who are friendly and greet Lucy, rudely remarking: "How'd all these ducks get to know you so quick?" He is slightly annoyed that his mother invited them:

George: I really don't see why my mother invited them.
Lucy: Maybe she didn't want to offend their fathers and mothers.
George: I hardly think that my mother need worry about offending anybody in this old town.
Lucy: It must be wonderful, Mr. Amberson, Mr. Minafer, I mean.
George: What must be wonderful?
Lucy: To be so important as that.
George: Oh, that isn't important...Anybody that really is anybody ought to be able to go about as they like in their own town, I should think.

George is again repulsed by the "freshness" of her father - the "queer-looking duck" waving at them while he is dancing with Aunt Fanny (Agnes Moorehead), Wilbur Minafer's unmarried, shrill-voiced sister who moved in with the Ambersons following Isabel's marriage. George immediately takes a dislike for Eugene - unaware of who the gentleman is.

Lucy shows great maturity and sound judgment and refuses to be drawn into George's criticism of her male acquaintances or her father. She tells George that her father, a widower, is a successful inventor "working on a new kind of horseless carriage." George shows a bit of disapproving contempt for her father's interests: "Horseless Carriage! Automobile!" As they sit and talk on the stairway, Lucy expresses how she now understands "what it means to be a real Amberson in this town." George has a disdainful feeling about most females: "Most girls are usually pretty fresh. They ought to go to a man's college for about a year. They'd get taught a few things about freshness."

As Eugene walks forward and calls up to ask Lucy for a dance (with Aunt Fanny on his arm), George is taken aback when he learns that the flowers Lucy carries were given to her by the same man - her father, the man he was derisively calling "a queer looking duck." Simultaneously, Fanny moves out of the frame as Isabel moves in and asks her son: "George dear, are you enjoying the party?"

Around a gleaming punch bowl, the family members recall family relationships, including Eugene's incident with the bass viol that ultimately led to Wilbur's marriage to Isabel. The elderly Major Amberson teases Isabel about her rejection of Eugene when he was drunk: "Isabel, I remember the last drink Gene ever had." His remark causes Isabel to blush. Fanny reacts with a cheerful deduction as she compliments her brother Wilbur - and attempts to slyly remind Eugene that Isabel is permanently married but that she is available: "The important thing is that Wilbur did get her, and not only got her, but kept her." With a loving look at his daughter as she passes by from his left and crosses into the foreground, Eugene refers to another important result of his loss of Isabel:

There's another important thing, that is, for me. In fact, it's the only thing that makes me forgive that bass viol for getting in my way...Lucy.

In a scene that begins with the older generation dancing, and ends with the children of their separate marriages dancing, Eugene stands with Uncle Jack in front of a fireplace (with mantel and mirror) before he takes Isabel for a dance. They wistfully refer to "old times" (when he used to court her) and the hopeful, optimistic dawn of "new times" for further romance:

Jack: Eighteen years have passed, but have they?...By gosh, old times certainly are starting all over again.
Eugene: Old times. Not a bit. There aren't any old times. When times are gone, they're not old, they're dead. There aren't any times but new times.

To the accompaniment of an upbeat, ragtime-style rhythm, the camera moves backward in a long, unedited, continuous take as they exuberantly dance forward toward the camera - until it picks up the younger couple of Lucy and George who enter from the left.

Before the young pair themselves dance backward and fade away into a group of other dancers behind them on the dance floor, Lucy questions George about what he studies in school and what he wants to become in life, but he condemns the lives of businessmen - expecting to never enter a profession but live on his family's fortune:

Lucy: What are you studying at school?
George: College.
Lucy: College.
George: Oh, lots of useless guff.
Lucy: Why don't you study some useful guff?
George: What do you mean, useful?
Lucy: Something you'd use later in your business or profession.
George: I don't intend to go into any business or profession.
Lucy: No?
George: No.
Lucy: Why not?
George: Well, just look at them. That's a fine career for a man, isn't it? Lawyers, bankers, politicians. What do they ever get out of life, I'd like to know. What do they know about real things? What do they ever get?
Lucy: What do you want to be?
George (fatuously): A yachtsman! (Lucy reacts with astonishment)

When the ball is near its end, the older lovers Eugene and Isabel are still gracefully gliding together on the darkened, deserted dance floor, waltzing to a plaintive violin tune amid the shadows. Running down from an upper stairs landing, the youthful pair of George and Lucy sit in a lighted space at the foot of the staircase closeby and watch their parents. [It is a symbolic representation of the two generations, one reclaiming its love, the other looking into the future for love.] George tells Lucy that he finds the automobile repulsive and Eugene's line of work worthless:

Horseless Carriages! Automobiles!...People aren't gonna spend their lives lying on their backs in the road letting grease drip in their faces. No, I think your father better forget about 'em.

During the leavetaking, Eugene and Isabel say a hushed, simple goodnight to each other, amid many other overlapping voices: "Goodnight Isabel. Goodnight Eugene." After exerting his forceful will over Lucy during the goodbyes, George invites Lucy for an afternoon sleigh ride the next day. Profiles are silhouetted against a window thickly framed in ice and frost.

As Lucy and her father depart in their open-air horseless carriage, she cheerfully asks above the noisy clattering of the automobile engine: "Do you think George is terribly arrogant and domineering?" Eugene replies: "Oh, he's still only a boy. Plenty of fine stuff in him. Can't help but be. He's Isabel Amberson's son." Lucy smiles back, realizing how much her father once loved Isabel: "You liked her pretty well once, I guess, Papa." He admits that she is right: "Yep. Do still."

Meanwhile, in a conversation around the great upstairs landing of the darkened Amberson's staircase, one that forebodes family rivalry, Isabel expresses her worry to George about Wilbur's health and his bad investments: "It seems to me he looks so badly...He's been worried about some investments he made last year. I think the worry's affected his health." George is very forthright: "What investments? He isn't going into Morgan's automobile concern, is he?," determined that Amberson financing not be used for Eugene's horseless carriage venture.

Wilbur appears in the doorway of his bedroom in a dressing gown, looking harried, overworked, and worried. The spinsterish Fanny, who has always been infatuated with Eugene, appears in the background of the corridor with Jack. She defends Eugene's business affairs, arguing that he is not out to woo Amberson money:

George: Look here, father, about this man Morgan and his old sewing machine. Don't they want to get grandfather to put some money into it? Isn't that what he's up to?
Fanny: You little silly! What on earth are you talking about? Eugene Morgan's perfectly able to finance his own inventions these days.
George: I'll bet he borrows money from Uncle Jack.
Isabel: Georgie. Why do you say such a thing?
George: He just strikes me as that sort of a man. Isn't he father?
Wilbur: He was a fairly wild fellow twenty years ago. He's like you in one thing, Georgie. He spent too much money. Only he didn't have any mother to get money out of her grandfather for it. But I believe he's done fairly well of late years, and I doubt if he needs anybody else's money to back his horseless carriage.
George: Oh, what's he brought the old thing here for, then?
Wilbur: I'm sure I don't know. You'll want to ask him.

On the way to Fanny's room in a shadowy tense scene [a grotesque shadow of a peacock is behind Fanny's profile], George is convinced that the Ambersons are treating Eugene too cordially. He mercilessly teases Fanny about her interest and fondness for the widower Eugene. Her retaliatory mocking of George is ineffective - she betrays some self-pity and jealousy of Eugene's love for Isabel:

Fanny: Eugene Morgan isn't in your father's thoughts at all one way or the other. Why should he be?...
Uncle Jack: Are you two at it again?
George: What makes you and everybody so excited over this man Morgan?
Uncle Jack: This man Morgan.
Fanny: Excited!
Uncle Jack: Oh, shut up.
Fanny (in an hysterical, off-pitch outburst): Can't...can't people be glad to see an old friend without silly children like you having to make a to-do about it? I've just been suggesting to your mother that she might give a little dinner for him.
George: For who?
Fanny (correcting): For whom, Georgie.
George (mocking her): For whom, Georgie.
Fanny: For Mr. Morgan and his daughter.
George: Oh look here. Don't do that. Mother mustn't do that.
Fanny (repeating the phrase to mock him): Mother mustn't do that.
George: Wouldn't look well.
Fanny (repeating the phrase to mock him, and then turning nervously hysterical): Wouldn't look...See here Georgie Minafer! I suggest that you just march straight on into your room. Sometimes you say things that show you have a pretty mean little mind.
George: What upsets you this much?
Uncle Jack: Shut up!
Fanny: I know what you mean. You're trying to insinuate that I get your mother to invite Eugene Morgan here on my account...
Uncle Jack (protesting off camera): I'm gonna move to a hotel.
Fanny: ...because he's a widower.
George: What?
Fanny: What?
George: Ha, ha, ha. (Fanny cackles back in mock laughter at him) I'm trying to insinuate that you're setting your cap for him and getting mother to help you?
Fanny: OH! (Fanny slams her door on him)
George: Is that what you mean?

In the next, joyous, much-celebrated, memorable winter scene in the film, George and Lucy are seen whirling along in a horse-drawn sleigh, luminously reflected in a frozen pool of water. Their gay, sparkling ride is accompanied by the tinkling of bells incorporated into the soundtrack. The juxtaposition of two time periods is beautifully contrasted: the silent, graceful movement of the horse and sleigh speeds past Eugene's new but stalled motor carriage (with passengers Isabel, Fanny, and Uncle Jack - Wilbur is conspicuously absent), [an authentic 1905 Model Sears] decorated with a tasseled canopy. It has become bogged down in the snow and Eugene struggles to crank the sputtering Morgan Motor and set it free. Suddenly, George and Lucy pass the horseless carriage, and George calls out:

Get a horse! Get a horse!

George is humiliated when their sleigh overturns and tips over, and the sled spills the couple over and down a mound into a drift of snow. But they are unhurt and steal a kiss from each other. Eugene is relieved that Lucy isn't injured: "The snow bank's a featherbed." George is obsessively fussed over by his mother as she continues to brush snow off him, although he appears embarrassed by her attention in front of the others: "Don't make a fuss, mother...Please mother, please. I'm all right."

They are led back to the horseless carriage through the bare branches of the wooded area for the rest of their trip. Their horse Pendennis gallops away. Eugene compliments Isabel: "You're the same Isabel I used to know - you're a divinely ridiculous woman," although Isabel thinks the two words are exact opposites:

Isabel: Divinely ridiculous just counterbalance each other, don't they? Plus one and minus one equal nothing. So you mean I'm nothing in particular?
Eugene: No, that doesn't seem to be precisely what I meant.

When the 'Morgan Invincible' stalls again, Eugene asks George to "push" and he must breathe in smelly exhaust fumes from the detestable horseless carriage. Tormented by Eugene's regard for Isabel, Fanny shrewdly tries to talk above the noise of the engine to Lucy in order to get Eugene's attention and impress him with her comments - it is "so like old times" in the past to have a second opportunity to catch Eugene:

Your father wanted to prove that his horseless carriage would run even in the snow. It really does too...It's so interesting. He says he's going to have wheels all made of rubber and blown up with air. I should think they'd explode...Eugene seems very confident. Oh, it seems so like old times to hear him talk.

Everyone happily sings: "The Man Who Broke the Bank at Monte Carlo" - a song about money as an entertaining plaything - as the camera focuses on the beautiful faces of the singing occupants (even Fanny) in close-up. At the end of the entire sequence, as the car with merry singers moves up to the horizon in the lower right hand side of the frame, the camera slowly irises-out on the car [a tribute to older silent films], turning the screen black.

In the next scene, one with considerable narrative economy and restraint, Eugene's shadow falls onto the frosted panels on the outside of the wooden oak doors of the Amberson mansion as sinister musical chords play on the soundtrack. A black, circular funeral wreath, in contrast to the circular halo of the dark iris that closed the previous scene, conveys the fact that a death has occurred: a major turning point in the film. After ring the bell, mourners (Eugene and Lucy) are let into the house by the black butler - an entrance mirroring their earlier entrance into the ball scene. In ominous fashion, Eugene's shadow enters the doorway before his own body - it will be the final time that he will ever enter the Amberson doorway. Wilbur Minafer's body, never identified explicitly, is laid out in the Amberson library. With the camera shooting from the vantage point of the interior of the coffin, somber, respectfully-silent family members pass by during the reception in a fluid take, paying their last respects. [The coffin is never shown.]

Fanny observes as Eugene takes Isabel's arm and they go out of the frame. The scene ends on a particularly striking but ambiguous close-up of Aunt Fanny's anguished face with tears streaking down. She is the one family member most affected by the death - of her brother. Her tears may also reflect her worry or fury about the possibility of a future romance between widower Eugene and widowed Isabel. Later, townspeople discuss the death of Wilbur Minafer: "Wilbur Minafer. A quiet man. The town will hardly know he's gone." [The decline of the Ambersons' fortune begins with the death of Wilbur Minafer.]

At the start of the next scene, a lightning bolt strikes as rain sweeps across the Amberson mansion at nighttime. [It is wrong to assume that this is the day of Wilbur's funeral. In fact, because of the harsh editing, a considerable amount of time has passed and it leaves the viewer confused. George has just graduated from college and received his diploma at commencement.] In the huge Amberson kitchen, the camera never moves as Fanny brings a large piece of fresh strawberry shortcake to her nephew George, and then reinforces Isabel's maternally protective attitude toward him: "It's the first of the season," she describes it. "Hope it's big enough...Sweet enough?...Don't eat so fast, George." With a napkin tucked into his collar, George eats gluttonously.

Uncle Jack enters the kitchen behind them as George makes passing, teasing comments about Fanny's infatuation for Eugene Morgan. They both torment Fanny unmercilessly, telling her that Eugene is dressing up specially to impress her. Sensitive to their criticism, Aunt Fanny becomes increasingly agitated and distressed, cries, rises from the table, and slams the door as she leaves the kitchen:

George: Well it struck me that Mr. Morgan was looking pretty absent-minded most of the time. And he certainly is dressing better than he used to.
Uncle Jack: Oh, he isn't dressing better, he's dressing up. Fanny, you ought to be a little encouraging when a prized bachelor begins to show by his haberdashery what he wants you to think about him.
George: Well, Jack tells me the fact he's been doing quite well.
Uncle Jack: Quite well.
George: Listen Aunt Fanny. I shouldn't be a bit surprised to have him request an interview and declare that his intentions are honorable. (Fanny begins to break down and runs from the room)

[In the process of re-editing, virtually all of the material that deals specifically and directly with the causes and nature of the economic decline of the Ambersons was eliminated.] George tries to explain away Aunt Fanny's deep hurt by complaining about her inability to be teased - and he grieves about the loss of another victim for his own entertainment:

It's getting so that you can't joke with her about anything anymore. With all the gambling, we found out that father's estate was all washed up and he didn't leave anything. I thought she'd feel better when he turned over his insurance to her.

With greater concern for his sister, Uncle Jack regrets his cruelty:

I think we've been teasing her about the wrong things. Fanny hasn't got much in her life. You know George, just being an Aunt isn't really the great career it sometimes seemed to be. Really don't know of anything much Fanny has got, except her feeling about Eugene.

As Uncle Jack speaks, George abstractedly walks toward the window. [Here, a key scene was cut from the original version of the film. George is startled and surprised by what he sees outside the window - the immense grounds surrounding the Amberson mansion are being dug up to build houses. There are concrete blocks and bricks all around - Major Amberson has had to sell off parcels of land around the house in order to raise money for the estate. This property is, in turn, subdivided and sold by the new owners. As the city spreads to the suburbs, the new houses become run-down and dirty.]