The second act is laid in a village inn near Kulmbach. The assembled peasants are all talking of the Devil whom they declare they have seen in person. While they are talking a rap is heard at the door, and Hans stands outside clad in his bearskin, asking for food and shelter. In their terror they all refuse to let him in believing him to be the devil himself, until the Burgomaster suggests that the man in this hideous disguise should be made to show his feet. When this is done and the peasants see that the stranger has no cloven hoof but human feet they are satisfied that all is right. While they are still deliberating Hans breaks open the window and springs into the room. The peasants eye him with amazed curiosity, and the host at first refuses to give a night's lodging to such a suspicious looking object, but a piece of gold out of Hans' never empty sack makes him change his mind. He sets the bar maid on to sound the queer fellow and she draws from Hans that he is a relation of the Emperor of Marocco, and other nonsense, which makes all think he is insane but harmless. Presently the Burgomaster falls asleep but is rudely awakened by the host who reminds him of a debt of 60 Florins which he had promised to pay. The Burgomaster not being able to pay a quarrel takes place, which is ended by Hans paying down the money himself and sending the innkeeper to bed. Left alone with the bewildered Burgomaster, Hans questions him about his family and circumstances and learns that the good man has three daughters whom he anxiously wishes to see married. Hans, without more ado, offers himself as a suitor for one of them, in the hope that this is an opportunity for his deliverance from his unhappy plight by the true love of a woman. The Burgomaster accepts his offer, believing Hans to be some grandee under a spell, or bewitched and supposing that when he claims his bride he will be restored to his proper form. Hans however assures him the lady will have to accept him as he is, unkempt and unwashed. After wishing the Burgomaster good night, Hans retires to his chamber, leaving his knapsack in the outer room. The innkeeper on the watch, waits till all is still and comes noiselessly in to steal the money from the sack. He puts in his hand and draws out—not gold—but scorpions, mice, frogs and other vermin which fly about and torment him till at his cries Hans comes to the rescue and the goblin creatures disappear.
In the next scene it is early morning; the servants come in and adorn the inn with boughs of birch as is the custom at the festival of Whitsuntide.
The Burgomaster appears with his three daughters; he first presents to Hans his eldest, Line, but when she sees him she turns away in horror at the appearance of the suitor, and calling the second sister Gunda both mock the poor fellow, and laughing turn homewards. The youngest girl, Luise, her father's favourite, not knowing what was going on, comes in to look for her father, and seeing Hans standing there in tears, at once checks the laughter that was provoked by his droll appearance, and moved to pity asks what ails him. At first he is unwilling to answer, but, when she presses him to speak, he shows her the ring and tells her that if she were willing to wear it for three years, always thinking kindly of him, the gold would remain bright, and at the end of that time the bann would be taken off him. Luise promises never to forget him, and though Hans hesitates to give her the ring, fearing the trial will be too heavy for the sweet child to whom his heart goes out in love, she draws the ring from him, passes a ribbon through it and hangs it round her neck.
In the meanwhile, the peasants, led by the revengeful innkeeper, make an attack upon Hans and try to take away his sack. Hans relates how the innkeeper tried to rob him, and forces him to show the 60 Florins the latter had received for the Burgomaster's debt. In rage the innkeeper throws the pieces on the ground; a flame leaps up from the spot. This convinces the peasants that Hans is in league with the Devil; they are about to kill him when Luise calls for aid and her courage so astonishes the assailants that they let Hans go.
The third act takes place three years later.
Hans is discovered lying in a dense forest fast asleep. The Devil has summoned a number of his little imps who are busily engaged in washing, combing and dressing the sleeper. Satan is in a very bad temper, but he does not give up his battle for a soul with Heaven yet, and intends to make a last effort to get Hans into his clutches. The lad's hand, on which is the fateful ring, hangs close to the water of the brook near which he lies, and Satan calls the water nymphs to take it from him. But at this moment Hans wakes and his first thought is for the ring which he looks at with rapture, seeing that its gold shines undimmed. The Devil, (who appears not to be such a bad fellow after all,) greets him in a friendly manner, and Hans, delighted to find himself free from the spell, requires at once the fulfilment of the three wishes the devil has promised to grant. His first wish, to become what he was before, is already fulfilled. His second wish, to keep the sack, but free from magic gold and charm, is also granted. His third wish is, that for the future the Devil will let him alone and never cross his path again. This also the Devil agrees to and mockingly bestows upon him the bearskin into the bargain. Hans now recognises it as the skin of a bear he had once killed himself. Hans' one thought now is for his betrothed bride. On his way to her St. Peter appears to him once more. He tells that the Plassenburg is about to be stormed, and urges him to save it from the enemy.
The next scene opens again in the hero's native village. A crowd of people is assembled before the Burgomaster's house; they are looking towards the Plassenburg which they fear is already in the enemy's hand. No sound is heard from the fortress; its defenders seem to be in deep sleep. Suddenly the trumpets sound and in breathless anxiety men and women watch the battle that now begins.
At last a man comes running up in hot haste shouting that victory is theirs. He relates how that believing Wallenstein to be far away all the garrison went to sleep when they were suddenly awakened by a loud knocking, and the cry "the Friedlander is at the gates!"
The commander Kuensberg sprang out, and at his side, fighting like a lion, a stranger in whom they presently recognized their fellow soldier, Hans Kraft, who had served in the same army years ago; to him they now owe the victory. Everybody begins to praise the deliverer and to ask where he is, for he had gone away and had not been heard of again.