The Captain returns home with his fiancee - the wealthy, glamorous Austrian Baroness, and Max Detweiler, a self-proclaimed "very charming sponge" and an impresario who mentions that "somewhere, a hungry little singing group is waiting for Max Detweiler to pluck it out of obscurity and make it famous at the Salzburg Folk Festival." On their drive toward the villa, they notice the rambunctious Trapp children hanging from limbs along the tree-lined road. The Captain quickly dismisses the children's behavior: "Oh, it's nothing - just some local urchins." He shows Elsa his estate upon their arrival where she feels he is more "at home" than in Vienna. He compliments her as being "lovely, charming, witty, graceful, the perfect hostess, and...in a way, my savior...Well, I would be an ungrateful wretch if I didn't tell you at least once that it was you who brought some meaning back into my life..." She hints at her own desire for marriage, mentioning that without her environment in Vienna, she is "just wealthy, unattached little me searching just like you."

When the Captain exits to look for his children, Elsa and Max speak about her strategy to win over the wealthy, aristocratic Captain:

Max: Have you made up Georg's mind yet? Do I hear wedding bells?
Elsa: Pealing madly.
Max: Marvelous.
Elsa: But not necessarily for me.
Max: What kind of talk's that?
Elsa: That is none of your business talk, Max. I am terribly fond of Georg and I will not have you toying with us.
Max: But I am a child. I like toys, so tell me everything. Oh come on, tell Max every teensy, weensy, intimate disgusting detail.
Elsa: Well, let's just say I have a feeling I may be here on approval.
Max: Well, I approve of that. How can you miss?
Elsa: Far too easily.
Max: If I know you, darling, and I do, you will find a way.
Elsa: Oh, he's no ordinary man.
Max: No, he's rich!
Elsa: When his wife died, she left him with a terrible heartache.
Max: And when your husband died, he left you with a terrible fortune.
Elsa: Oh, Max, you really are a beast.
Max: You and Georg are like family to me. That's why I want to see you two get married. We must keep all that lovely money in the family.

As Rolf throws small rocks at Liesl's window, he is caught by the Captain. Embarrassed, he makes a Heil Hitler gesture, and then delivers a telegram to Herr Detweiler, an apolitical bystander. The imminent political and military invasion-takeover of Austria by the Nazis is a subject of contention between them, and the Captain refuses to surrender:

Elsa: Oh Georg, he's just a boy.
Captain: Yes, and I'm just an Austrian.
Max: What's gonna happen's gonna happen. Just make sure it doesn't happen to you.
Captain: (incensed) Max, don't you ever say that again!
Max: You know I have no political convictions. Can I help it if other people do?
Captain: Oh yes you can help it. You must help it.

The children are spied canoeing on the lake - as they stand to greet their father in the unwieldy vessel, the boat overturns and capsizes, and everyone falls out. The completely soaked von Trapps are whistled into a line, introduced to Baroness Schraeder, and then dismissed. Still dripping wet, Maria is chastised for her conduct, for making playclothes out of common house drapes, and for encouraging their disobedience:

Captain: Is it possible, or could I have just imagined? Have my children by any chance been climbing trees today?
Maria: Yes, Captain.
Captain: I see. And where, may I ask, did they get these, uhm, these...
Maria: Playclothes.
Captain: Oh, is that what you call them?
Maria: I made them, from the drapes that used to hang in my bedroom...They still had plenty of wear left. The children have been everywhere in them.
Captain: Do you mean to tell me that my children have been roaming about Salzburg dressed up in nothing but some old drapes?!
Maria: (affirming) Umm, hmm, and having a marvelous time.
Captain: They have uniforms.
Maria: Straitjackets, if you'll forgive me.
Captain: I will not forgive you for that.
Maria: Children cannot do all the things they're supposed to do if they have to worry about spoiling their precious clothes they wear....Well, they wouldn't dare. They love you too much. They fear you too much.
Captain: I don't wish you to discuss my children in this manner.
Maria: Well, you've got to hear from someone. You're never home long enough to know them.
Captain: I said I don't want to hear any more from you about my children.
Maria: I know you don't, but you've got to!

Outspoken, she pleads for him to get to know and love his children more completely, as she does: "Oh please, Captain, love them, love them all." Exasperated by her impertinence, the stodgy commander orders her to leave: "You will pack your things this minute and return to the Abbey." At the same instant, he hears his children singing for the first time. Strains of "The Sound of Music" come from inside - the song that Maria taught them to sing for the Baroness. He enters the living room and watches his children performing - he is visibly touched, sings the remainder of the song, and hugs all of them. The Captain realizes his grave error in judgment and apologizes to Maria as she goes up the stairs to pack: "I behaved badly. I apologize...You were right. I don't know my children...You've brought music back into the house. I'd forgotten. Fraulein, I want you to stay. I ask you to stay more than you know."

In the Trapp villa one day, the children perform "The Lonely Goatherd," a puppet show, where they act as a chorus and as puppeteers. Marta has the task of dropping new backgrounds into place. After the show, the Captain compliments Maria - he has undergone a major change and defrosting of his personality due to her charm: "I really am very, very much impressed." The haughty Baroness feels a twinge of jealousy toward the talented governess for the Captain's children:

Elsa: My dear, is there anything you can't do?
Maria: Well, I'm not sure I'll make a very good nun.
Elsa: Oh, if you have any problems, I'd be happy to help you.

Max makes a surprise announcement to the Captain regarding his discovery of a "most exciting entry for the Salzburg Folk Festival" - "a singing group all in one family...yours! They'll be the talk of the festival...you heard them. They'll be a sensation...It's a wonderful idea, fresh, original." But the Captain denies them permission to be entered in the festival: "Max, my children will not sing in public." However, Maria and the children convince him to play guitar and sing the tender and poignant "Edelweiss" [Austria's national flower], accompanied during the second verse by daughter Liesl:

Edelweiss, Edelweiss, every morning you greet me
Small and white, clean and bright, you look happy to meet me
Blossom of snow may you bloom and grow, bloom and grow forever
Edelweiss, Edelweiss, bless my homeland forever...

Max suggests that the Captain and his children be part of his "new act - the von Trapp Family Singers."

A formal dinner party with a full orchestra playing waltzes entertains wealthy guests at the villa. Herr Zeller (Ben Wright), a Nazi supporter, is disturbed that an Austrian flag is audaciously displayed in the grand foyer of the mansion. One of the orchestral numbers is the "Laendler," an Austrian folk dance, which Maria demonstrates to the children on the outdoor patio. The Captain cuts in and dances with his children's nanny. When the couple looks into each other's eyes, they begin to fall in love - and Maria blushes. The Baroness witnesses the dance's conclusion and the glow of their budding romance, and offers her insincere compliments: "Oh, that was beautifully done. What a lovely couple you make."

Before retiring for the night, the children perform a good-night song for the guests: "So Long, Farewell." One by one, each of them bids the audience farewell (goodbye, adieu, auf wiedersehen, etc.) before exiting. Afterwards, Max insists that Maria join the party - once she changes into more suitable party clothes: "You will be my dinner partner." Another confrontation underlines the tension between the loyal Austrian Captain and a representative of the German Nazis:

Baron: Is there a more beautiful expression of what is good in this country of ours than the innocent voices of our children?
Zeller: Oh, come now, Baron, would you have us believe that Austria alone holds a monopoly on virtue?
Captain: Herr Zeller, some of us prefer Austrian voices raised in song to ugly, German threats.
Zeller: The ostrich buries his head in the sand, and sometimes in the flag. (He turns toward the Austrian flag.) Perhaps those who would warn you that the Anschluss is coming - and it is coming, Captain - perhaps they would get further with you by setting their words to music.
Captain: If the Nazis take over Austria, I have no doubt, Herr Zeller, that you will be the entire trumpet section.
Zeller: You flatter me, Captain.
Captain: Oh, how clumsy of me. I meant to accuse you.

As Maria changes in her bedroom, the Baroness 'helps' Maria by telling her about the Captain's feelings and his dangerous attraction to her. This fearful, confusing news and her own disoriented, romantic emotions prompt the novice to begin packing:

Baroness: Now, where is that lovely little thing you were wearing the other evening, when the Captain couldn't keep his eyes off you.
Maria: Couldn't keep his eyes off me?
Baroness: Come, my dear, we are women. Let's not pretend we don't know when a man notices us...
Maria: The Captain notices everybody and everything.
Baroness: Well, there's no need to feel so defensive, Maria. You are quite attractive, you know. The Captain would hardly be a man if he didn't notice you.
Maria: Baroness, I hope you're joking.
Baroness: Not at all.
Maria: But I've never done a thing to...
Baroness: But you don't have to, Maria. There's nothing more irresistible to a man than a woman who's in love with him.
Maria: 'In love with him'?
Baroness: Of course. What makes it so nice is he thinks he's in love with you.
Maria: But that's not true.
Baroness: Oh surely you've noticed the way he looks into your eyes. And you know, uh, you blushed in his arms when you were dancing just now. Don't take it to heart. He'll get over it soon enough, I should think. Men do, you know.
Maria: Then I should go. I mustn't stay here.

As the scheming Baroness departs, she leaves with one under-handed word of encouragement about Maria's religious duties: "I'm sure you'll make a very fine nun." Later, Maria stealthily comes down the stairs and places a goodbye letter on the hallway's table before running back to the Abbey.

In the next sequence, the Baroness clumsily attempts to play ball with the gloomy-looking children - but they are joyless and inconsolable after Maria's departure. Elsa plots a way to deal with the children: "There must be an easier way," and tells Max that her plan is to send them away to boarding school. Without Maria, the down-hearted children sing "The Sound of Music" slowly and spiritlessly when Max rehearses them for the festival. They cannot believe that Maria is permanently gone: "I don't believe it, father...about Fraulein Maria." In her goodbye note, she wrote that "she missed her life at the Abbey too much. She had to leave us - and that's all there is to it." The littlest one asks: "Who is our new governess going to be?" The Captain takes the opportunity to announce his engagement to the Baroness:

Well, you're not going to have a governess anymore...You're going to have a new mother...We talked about it last night. It's all settled. And we're all going to be very happy.

The seven cheerless, depressed children dutifully kiss the cheek of their new 'mother' and then venture to town to try and visit Maria at the Abbey, but they are turned away and told - "Maria is in seclusion. She hasn't been seeing anyone."

Afterwards, Sister Margaretta describes Maria's silence to the Reverend Mother: "She doesn't say a word, Reverend Mother, except in prayer...It's strange. She seems happy to be back here, and yet she's unhappy too." In a private conference with the Reverend Mother, Maria confesses why she came back - to escape from her deep, unacknowledged romantic feelings for the Captain. She is persuaded by the sympathetic Mother to return, with the understanding that married love is also a holy vocation:

Maria: I left...I was frightened...I was confused, I felt, I've never felt that way before. I couldn't stay. I knew that here I'd be away from it. I'd be safe...I can't face him again...Oh, there were times when we would look at each other. Oh Mother, I could hardly breathe...That's what's been torturing me. I was there on God's errand. To have asked for his love would have been wrong. I couldn't stay, I just couldn't. I'm ready at this moment to take my vows. Please help me.
Reverend Mother: Maria, the love of a man and a woman is holy too. You have a great capacity to love. What you must find out is how God wants you to spend your love.
Maria: But I pledged my life to God. I pledged my life to his service.
Reverend Mother: My daughter, if you love this man, it doesn't mean you love God less. No, you must find out and you must go back.
Maria: Oh, Mother, you can't ask me to do that. Please let me stay, I beg of you.
Reverend Mother: Maria, these walls were not built to shut out problems. You have to face them. You have to live the life you were born to live.

The worldly-wise Reverend Mother sings the inspirational: "Climb Ev'ry Mountain" to encourage Maria:

Climb ev'ry mountain, search high and low
Follow ev'ry byway, every path you know
Climb ev'ry mountain, ford every stream
Follow every rainbow, till you find your dream
A dream that will need all the love you can give
Every day of your life for as long as you live...