In the next memorable scene set in the Haunted Forest near the Witch's castle, with eerie bird cries and gargoyle-faced gnarled trees, a sign states: "Haunted Forest, Witches Castle, 1 mile" and "I'd Turn Back If I Were You." The quartet carry their weapons at the start of their adventure: a gun, a giant wrench, a net, and a spray gun of Witch Remover. The Lion reads the sign and whirls around, ready to comply, but his determined companions grab him firmly and turn him around. After the Tin Man has been mysteriously lifted into the air and dropped with a loud clanging noise to the ground, the Lion chants as he wrings his tail:

I do believe in Spooks, I do believe in Spooks, I do, I do, I do, I do, I do, I do believe in Spooks, I do believe in Spooks, I do, I do, I do, I do, I do, I DO!

Once again, the Witch watches them from her crystal ball. She turns to Nikko, the captain of her squadron of Winged Monkeys and issues commands for an assault:

Take your army to the Haunted Forest and bring me that girl and her dog. Do what you want with the others, but I want her alive and unharmed. They'll give you no trouble, I promise you that. I've sent a little insect on ahead to take the fight out of 'em. [The reference is to the song "The Jitterbug" that doesn't appear in the final film release.] Ha-ha-ha-ha. Take special care of those ruby slippers. I want those most of all. Now fly, fly!

Suddenly, they are set upon by the army of bluish, ugly winged monkeys sent by the Witch. The attackers swoop down, tear apart the Scarecrow, and snatch Dorothy and Toto. They kidnap the two and carry them off to the mountaintop castle.

The three companions are left on their own - the Scarecrow explains to the Tin Man and the Lion how he was treated by the monkeys - he was de-strawed: "They tore my legs off and they threw them over there. Then they took my chest out and they threw it over there." For comic relief, the Tin Man observes humorously: "Well, that's you all over." The Lion adds: "They sure knocked the stuffin' out of you, didn't they?" The Scarecrow plots: "Don't stand there talking. Put me together. We've got to find Dorothy."

With Dorothy imprisoned in the tower room of her castle, the Wicked Witch sets up a blackmailing scheme - she places Dorothy's beloved dog ("What a nice little dog") in a wicker basket, taunts her captive with fears of a drowned pet, and offers to exchange Toto for the ruby slippers [Likewise, Miss Gulch, the Witch's alter ego also played by Margaret Hamilton, had also threatened Dorothy's dog in Kansas]:

Witch: And you, my dear, what an unexpected pleasure. It's so kind of you to visit me in my loneliness.
Dorothy: What are you gonna do with my dog? Give him back to me.
Witch: All in good time, my little pretty. All in good time.
Dorothy: Oh please give me back my dog.
Witch: Certainly, certainly, when you give me those slippers.
Dorothy: But the Good Witch of the North told me not to.
Witch: Very well. (To her winged-monkey captain) Throw that basket in the river and drown him.
Dorothy: No, no. Here, you can have your old slippers but give me back Toto.
Witch: That's a good little girl. I knew you'd see reason.

When Dorothy surrenders to the Witch's horrible plan, the Witch attempts to take the slippers off by herself. She eagerly curls her long green fingers over them to take them, but her hands are electrocuted/zapped by voltages of sparks from the magical slippers. Dorothy apologizes and continues to bargain for her dog: "Oh I'm sorry. I didn't do it. Can I still have my dog?" The crafty Witch shouts: "No!" and hints at Dorothy's death to get at the enviable slippers:

Fool that I am. I should have remembered. Those slippers will never come off, as long as you're alive. But that's not what's worrying me. It's how to do it. These things must be done delicately or you hurt the spell.

Toto leaps out from the hamper/basket [for the second time in the film] and successfully runs out the door of the castle room as Dorothy screams encouragingly: "Run Toto, Run!" Nikko gives chase and castle guards toss their spears [accompanied by the second part of Mendelssohn's Three Fantasies or Caprices (Opus 16, No. 2) on the soundtrack]. Her dog runs down the staircase and scampers over the drawbridge to the outer embankment: "He got away!" Exasperated, the Witch threatens that time will soon run out for Dorothy. She has only has a short time longer to live - the time it will take for the red sand [symbolic of Dorothy's blood?] in a large hourglass timer to reach the bottom bulb.:

[He got away]...which is more than you will. Drat you and your dog. You've been more trouble to me than you're worth, one way or another, but it'll soon be over now. Do you see that? (She holds up a large hourglass timer with blood-red sand and turns it over to mark the last remaining minutes of Dorothy's life.) That's how much longer you've got to be alive. And it isn't long, my pretty. It isn't long. I can't wait forever to get those shoes.

The Witch locks her prisoner in the tower room and stalks away. Dorothy sobs to her ultimate protector - her guardian: "I'm frightened, Auntie Em. I'm frightened." In one of the film's most terrifying moments, Dorothy is left alone to view the Witch's crystal ball. She sees the anguished and worried face of Auntie Em inside the glass and calling out to her:

Auntie Em: Dorothy...where are you? Please, it's Auntie Em, we're trying to find you...
Dorothy: I'm here in Oz, Auntie Em - I'm locked up in the Witch's castle...(the crystal ball turns black) and I'm trying to get home to you, Auntie Em. Oh, Auntie Em, don't go away, I'm frightened. Come back!

She sees her caring Aunt's image horrifyingly turn into the destructive Witch's mocking green face ("Come back, Auntie Em, come back! I'll give you Auntie Em, my pretty") - wildly cackling ("Ah, ha ha ha ha hah hah!!") and then vanishing.

Toto finds Dorothy's three companions in the Haunted Forest and retrieves them. The Scarecrow interprets Toto's barking: "Why, don't you see? He's come to take us to Dorothy." They climb the rocky mountain to the Witch's castle to rescue her. On the cliff's edge, the Lion fears: "I-I-I hope my strength holds out." The Tin Woodsman, hanging on to the Lion's tail to scale the mountain, replies: "I hope your tail holds out!"

Outside the castle in a concealed hiding place, the three watch the Witch's Russian Cossack-like, enslaved, green-skinned sentinels march and chant the dirge-like "March of the Winkies." The Winkies are the Witch's guards, with helmets, long coats, and spears. ['Winkies' is an offensive term for Asians. Their chant is difficult to decipher, and sounds like: "O--Ee--Yah! Eoh--Ah!", although some claim they are saying: "All we own, we owe."] During the rescue sequence, each of them displays the qualities that they wish for: compassion, brains, and courage. The Lion bolsters up his courage: "I'll go in there for Dorothy. Wicked Witch or no Wicked Witch. Guards or no guards, I'll tear 'em apart. I may not come out alive, but I'm goin' in there. There's only one thing I want you fellas to do...Talk me out of it." They are ambushed by three of the sentry guards, but manage to overpower them after a brief scuffle. Even Toto manages to help - he grips in his mouth a red tassel he has ripped from one of the guard's uniforms. The three steal their uniforms for a disguise (although the Lion cannot hide his protruding tail). The Lion asks: "Do you think we'll be polite dropping in like this?" They smuggles themselves into the castle by marching at the rear of the procession.

Led by Toto, the rescuers find Dorothy in the tower where she is being held captive. [They are accompanied by the music of Mussorgsky's Night on Bald Mountain on the soundtrack.] Dorothy is terrified as she looks at the hourglass running out: "The hourglass is almost empty." The Tin Man splinters the thick wood of the door with his axe after eleven whacks. After liberating Dorothy, they try to escape out of the castle, with the Scarecrow encouraging them: "Hurry, we've got no time to lose." They are cornered and captured by the cackling Witch: "Going so soon? I wouldn't hear of it. Why, my little party's just beginning." When she hurls her hourglass before them, it bursts into flames and is destroyed. The Scarecrow cuts a rope holding a chandelier and they escape, but her guards chase them through the corridors, up and down the steep staircases and along the battlements and parapets of the castle. Without a way to escape from the mad pursuit, they are soon trapped, cornered and surrounded by guards holding spears:

Ring around the rosey. A pocket-full of spears. Thought you'd be pretty foxy, didn't ya?

They are held at the evil Witch's mercy - her plan to do away with each of them has arrived:

WELL - the last to go will see the first three go before her - and her mangy little dog too.

First, the Witch sets the Scarecrow's straw arm on fire by jabbing it with the lighted end of her broomstick: "How about a little fire, Scarecrow?" Dorothy tosses a nearby bucket of water on his arm to extinguish the flame, also accidentally splashing and drenching the Witch's face. [Dorothy causes a second death - a second Witch - but both murders are accidental and non-malevolent. As the adult witch shrinks in size, Dorothy has indeed proven that she can emerge greater and more grown-up as a result of her adventures.] She shrieks piteously in horror, her cries trailing off as she slowly dissolves and melts in a memorable death scene. Her "wickedness" is reduced to a puddle of vaporous clothing in front of everyone by the application of a simple substance - water:

Oh! You cursed brat. Look what you've done. I'm melting! Melting! Oh, what a world! What a world! Who would have thought a good little girl like you could destroy my beautiful wickedness. Oh, I'm gone, I'm gone, I'm going. Oh. Oh.

Toto sniffs around her black cloak and hat, the only remaining parts of the Witch. Dorothy is confronted by the head of the Winkies:

She's dead. You killed her.

She meekly stammers an apology but is unexpectedly hailed and congratulated as the liberator from the evil forces of a witch: "Hail to Dorothy! The Wicked Witch is dead!" Dorothy is presented with the defunct witch's broomstick after freeing herself and her friends - she turns excitedly to them: "Now we can go back to the Wizard and tell him the Wicked Witch is dead."

The next scene cuts quickly to the Wizard's throne room. The enormous face between two columns of fire cries out: "Can I believe my eyes? Why have you come back?" As she places the broomstick by the throne, Dorothy explains how they have completed their mission [she has been liberated but is still not enlightened about her salvation]. She requests that the Great Oz keep his promise:

Please sir, we've done what you told us. We brought you the broomstick of the Wicked Witch of the West. We melted her.

The Wizard is impressed and uses a pun to congratulate them: "Oh, you liquidated her, eh? Very resourceful." They are again fearful of the great Wizard who balks and tells them that they must go away and come back the next day: "Not so fast. NOT SO FAST! I'll have to give the matter a little thought. Go away and come back tomorrow." Dorothy is heartbroken and complains: "Tomorrow? Oh, but I want to go home now!" The Wizard booms back: "Do not arouse the wrath of the great and powerful Oz. I said, 'Come back tomorrow.'" Significantly, Dorothy challenges and criticizes the omnipotent, boon-dispensing Wizard: "If you were really great and powerful, you'd keep your promises."

Toto tugs and pulls away a shiny green curtain drape that covers a small booth, revealing, unmasking and exposing a white-haired, ordinary man who is furiously and frantically pulling levers, dials, switches and levers on an elaborate machine to control all the Wizard's special technological effects in the projected image. The fraudulent man (Frank Morgan again) suddenly looks over his shoulder and sees Dorothy and the others. After being found out for his fraudulent manipulations [similar to the chicanery of the carnival showman Professor Marvel earlier in the film], he tries to distract them but then sheepishly identifies himself:

The Wizard (covering up with the curtain): The Great Oz has spoken. Pay no attention to that man behind the curtain....the...Great...er...Oz has spoken.
Dorothy (pulling aside the curtain and reprimanding): Who are you?
The Wizard: (stuttering) I, I, I am the Great and Powerful Wizard of Oz.
Dorothy: You are! I don't believe you.
The Wizard: I'm afraid it's true. There's no other Wizard except me.
Scarecrow: You humbug.
Tin Man: Yeah.
The Wizard: Yes. That's exactly so. I'm a humbug.
Dorothy: (scolding) Oh, you're a very bad man!
The Wizard (sadly): Oh, no, my dear, I...I'm a very good man - I'm just a very bad Wizard.
Scarecrow (angrily): What about the heart that you promised Tin Man, and the courage that you promised Cowardly Lion...
Lion: And Scarecrow's brain?