This section opens with a memory from New Year's Eve, 1958. While Elena and Lila, aged 14, are attending a party in the neighborhood, Lila experiences the first of what she will describe to Elena many years later as episodes of "dissolving margins," possibly a form of panic attack. After the account of this episode, the narrative resumes with the events surrounding the end of elementary school, years prior to the dissolving margins incident.
After graduating from elementary school, Lila ends up continuing some schooling in a program designed to teach practical skills, but performs poorly, and suffers frequent illness. Elena does not perform well during her first year of middle school, and is disoriented by her experience of puberty. When she begins her period, she tries to confide in Lila, but Lila insists on Carmela also being present during the conversation. Surprisingly, Carmela turns out to have more expertise on the subject, having already begun her period. The conversation leads to Carmela and Elena bonding, and Lila feeling left out and defensive.
Elena's maturation attracts the attention of boys at school. They taunt her about her breasts, and one day, mimicking the assertiveness she has seen in Lila, Elena accepts money in exchange for baring her chest to two boys. The experience leaves her confused, but also highly aware of how influential Lila's logic and perspective have been on her. Although Elena and Lila spend less time together, and Lila is increasingly preoccupied by a new interest in the shoe-making business of her family, Elena remains fascinated with her friend and desirous of her attention.
Towards the end of Elena's second year of middle school, Gino, the son of a pharmacist, asks her to be his girlfriend. Elena declines, an action that Carmela finds confusing. Lila however seems to to respect Elena's decision, and advises her to give Gino an ultimatum: Elena will be his girlfriend if Gino will purchase ice cream for all three girls for the duration of the summer. Gino declines this offer. As the news of the interaction spreads, Lila finds herself considered an authority on romantic relationships.
Elena's results from her second-year exams are poor, and she is required to retake her Latin exam in September. Her parents are angry about this, and her father refuses to pay for additional tutoring. Elena's mother, however, suggests that Elena can study on her own throughout the summer, a project that Elena begins with great discipline. Noticing that Elena is studying, Lila asks to meet with her, so that she can also make use of the Latin textbooks. When the two girls begin studying together, Elena is impressed by how much Latin Lila already knows. Lila has been independently advancing her education by using books borrowed from the public library. In fact, Lila is able to change how Elena understands and approaches her study of the language. As the result of Lila's tutoring, Elena receives a very high score when she retakes the Latin exam in September.
As these events unfold in the lives of Elena and Lila, the structure of the neighborhood also shifts. The bar owned by the Solara family becomes very successful and expands. The Solara's two sons, Marcello and Michele, show off their new wealth by purchasing a car. Now that Don Achille is dead, the grocery store owned by his family also does better business.
This section highlights both the gaps and convergences in Lila and Elena's lives in two areas: their sexual and romantic development, and their academic and intellectual progress. In both areas, Elena seems to be racing ahead. Her body is developing, which attracts the attention of neighborhood boys, and she is continuing her schooling, which exposes her to new and more complex academic topics. It seems at first as if Lila might be in danger of being left behind. She is small, thin and childish in her appearance, and is not considered attractive. She is also no longer receiving formal schooling, and it seems that her destiny is now tied up with the family store and the constricted world of the neighborhood.
However, in both cases it turns out that Lila is still able to dominate due to her innate intelligence and shrewdness. While she is not yet the subject of romantic interest, by positioning herself as someone to whom the neighborhood girls can turn for advice, Lila ensures herself continued authority and social value. Similarly, while she is receiving formal education, she manages to ensure she is keeping up with Elena in her studying. In fact, Lila intuitively understands how to optimize academic performance. This shows the innate injustice, and perhaps a lingering guilt about it, that has always haunted Elena: it was mere chance that Elena was given the opportunity to continue her studies when Lila was not, and Lila would have been just as successful, if not more so.