It is a beautiful summer night, and the last echoes of the hunting horn are dying away on the evening breeze, when Ysolde turns to Brangeane, and impatiently bids her put out the light. The terrified nurse refuses to do so, and implores Ysolde not to summon her lover, declaring that she is sure that Melot, one of the king's courtiers, noted her pallor and Tristan's strange embarrassment. In vain she adds that she knows his suspicions have been aroused, and that he is keeping close watch over them both to denounce them should they do anything amiss. Ysolde refuses to believe her.
The princess is so happy that she makes fun of her attendant's forebodings, and, after praising the tender passion she feels, she again bids her put out the light. As Brangeane will not obey this command, Ysolde, too much in love to wait any longer, finally extinguishes the light with her own hand, and bids her nurse go up in the watch-tower and keep a sharp lookout.
Ysolde then hastens to the open door, and gazes anxiously out into the twilighted forest, frantically waving her veil to hasten the coming of her lover, and runs to meet and embrace him when at last he appears.
Blissful in each other's company, Tristan and Ysolde now forget all else, while they exchange passionate vows and declarations of love, bewailing the length of the days which keep them apart, and the shortness of the nights during which they can see each other. In a passionate duet of mutual love and admiration, they also rejoice that, instead of dying together, as Ysolde had planned, they are still able to live and love.
Brangeane, posted in the watch-tower above, repeatedly warns them that they had better part, but her wise advice proves useless, and it is only when she utters a loud cry of alarm that Tristan and Ysolde start apart. Simultaneously almost with Brangeane's cry, Kurvenal rushes upon the scene with drawn sword, imploring his master to fly; but ere this advice can be followed King Mark and the traitor Melot appear, closely followed by all the royal hunting party. Ysolde, overcome with shame at being thus detected with her lover, sinks fainting to the ground, while Tristan, wishing to shield her as much as possible from the scornful glances of these men, stands in front of her with his mantle outspread. He, too, is overwhelmed with shame, and silently bows his head when his uncle bitterly reproves him for betraying him, and robbing him of the bride he had already learned to love. Even the sentence of banishment pronounced upon him seems none too severe, and Tristan, almost broken-hearted at the sight of his uncle's grief, sadly turns to ask Ysolde whether she will share his lot. Shame and discovery have in no wise diminished her affection for him, and when she promises to follow him even to the end of the earth he cannot restrain his joy, and notwithstanding the king's presence he passionately clasps her in his arms:
‘Wherever Tristan's home may be,
That will Ysolde share with thee:
That she may follow
And to thee hold,
The way now shown to Ysold'!’
Melot, enraged at this sight, rushes upon Tristan with drawn sword, and wounds him so sorely that he falls back unconscious in Kurvenal's arms, while Ysolde, clinging to him, faints away as the curtain falls on the second act.
The third act is played in Tristan's ancestral home in Brittany, whither he has been conveyed by Kurvenal, who vainly tries to nurse his wounded master back to health and strength. The sick man is lying under a great linden tree, in death-like lethargy, while Kurvenal anxiously watches for the vessel which he trusts will bring Ysolde from Cornwall. She alone can cure his master's grievous wound, and her presence only can woo him back from the grave into which he seems rapidly sinking.
From time to time Kurvenal interrupts his sad watch beside the pallid sleeper to call to a shepherd piping on the hillside, and to inquire of him whether he descries any signs of the coming sail. Slowly and feebly Tristan at last opens his eyes, gazes dreamily at his attendant and surroundings, and wonderingly inquires how he came thither. Kurvenal gently tells him that he bore him away from Cornwall while wounded and unconscious, and brought him home to recover his health amid the peaceful scenes of his happy youth; but Tristan sadly declares that life has lost all its charms since he has parted from Ysolde. In a sudden return of delirium the wounded hero then fancies he is again in the forest, watching for the light to go out, until Kurvenal tells him that Ysolde will soon be here, as he has sent a ship to Cornwall to bring her safely over the seas.
These tidings fill Tristan's heart with such rapture that he embraces Kurvenal, thanking him brokenly for his lifelong devotion, and bidding him climb up into the watch-tower that he may catch the first glimpse of the coming sail. While Kurvenal is hesitating whether he shall obey this order and leave his helpless patient alone, the shepherd joyfully announces the appearance of the ship. Kurvenal, ascending the tower, reports to his master how it rounds the point, steers past the dangerous rocks, touches the shore, and permits Ysolde to land.