In the gardens, the boys’ eyes adjust and they are surprised by how much they can see in the moonlight. They arrive at 9 Gore Street. The dilapidated exterior confuses Charlie. Mr. Taylor answers gruffly and tells them to leave the beer on the porch. A wave of relief passes over Charlie when they walk away. They go home through the gardens, riding the trolley toward an elm tree where a group of boys are huddled. Barlow and his boys step out of the shadows. Norman provokes Barlow, who charges at him. While trying to run, Norman slips and shouts for Charlie to keep running. Charlie ducks into a bush, waits, then comes back. He witnesses B kick Norman in the ribs, then punch him in the jaw.
Norman spits blood in Barlow’s face. B orders his friends to put Norman on the trolley. B withdraws something long and slender from his coat and says he’s going to kneecap him. Charlie buries his face in the grass and screams as B lowers the pipe against Norman’s knees. The boys leave and Charlie runs out to Norman, who is bloodied and having difficulty breathing. Charlie pushes the trolley quickly to St. Vincent’s hospital. After getting Norman to the doctors, Charlie waits in the hospital. Two hours later a cop arrives to question Charlie, who lies and says they were looking to collect scraps of wood and metal. The doctor comes out and says Norman will be okay.
Charlie gives the doctor Norman’s address and walks home feeling sick. He vomits into the gutter. In the morning Charlie sees Norman in the mold on his wall. It is Saturday, and Norman won’t be taking the field as Richmond’s new center-half-forward. He hears his mother laughing in the kitchen. He goes in to discover she is no longer covering her face in white powder. She looks her usual self. Ma takes Charlie outside and empties the tin of powder into the duck’s dam and tells Harry it’s all his.
After training at Yarra Park with Mr. Redmond and Clarrie, Charlie returns home to find Alice is inside with his mother. He stands open-mouthed in shock as Ma takes the rabbits from his hands. Alice explains that she knows Charlie paid her father’s debt. She wanted to thank him by bringing a box of four massive cream buns. Ma brings tea and offers to put the gramophone record back on. She says that like her, Alice loves to dance. Charlie sees a vision of his father standing in the room, winking at Charlie and saying “giddy-up” before vanishing. They listen to the record ten times before Charlie offers to walk Alice home. Conversation flows easily between them on the walk, just as it does when Charlie talks to Norman. Before they part, Alice says she’ll drop by again.
Charlie goes to the hospital to visit Norman. To get past the nurse guarding the ward, Charlie lies and says he is Norman’s brother. The ward is eerily quiet. Though Charlie feels guilty, as though he, rather than Norman, should be in the hospital, Norman reassures him that he’s alright and tells him to stop blaming himself. Charlie leaves feeling his spirits raised by Norman’s positive attitude. Charlie heads to Darlington Parade, where he learns from Knuckles that Squizzy Taylor and Dolly had a tiff and so she packed her bags and left. Squizzy Taylor is drinking down the hall with his men, celebrating the previous night’s attack. Squizzy offers Charlie some whisky, which Charlie declines. Squizzy makes Knuckles give Charlie a glass anyway. Charlie begins to feel uncomfortable as Squizzy Taylor laughs about the newspaper headlines, which report on the gun violence in Fitzroy.
Charlie tries to tell Squizzy Taylor about what happened to Norman, but Squizzy Taylor says he doesn’t give a rat’s ass about Norman. After he tells Charlie to clear off, something clicks in Charlie’s head and he changes out of his boots into his father’s old ones. He gives the newer boots back to Squizzy, saying they never really fit him. Squizzy Taylor withdraws a silver pistol from his desk. Dasher appears behind Charlie and tells Squizzy that Charlie is only a lad. Charlie feels remarkably calm, given the situation. Squizzy points the gun to the left of Charlie’s head and fires. When he opens his eyes, Charlie sees that he and Squizzy Taylor are the only two people standing, the others having ducked. Squizzy concedes that Charlie has a set of balls on him and sends him away. On the street, Charlie runs with a sense of freedom, whooping and hollering. His days of running with Squizzy Taylor are over; now he’s running for himself.
Charlie comments that he is getting faster with Mr. Redmond’s training schedule. Twice a week they take the tram to St. Kilda beach so Charlie can sprint barefoot in the soft sand. People watch and jeer at him, but the attention and teasing only make him more determined. He welcomes the burning pain in his legs. Children join in, running alongside him. Meanwhile, as race day draws closer, the rival gangs of Richmond and Fitzroy go to battle. Gunfire is a common sound in the streets at night. The newspapers report on the killings and injuries and call it the Fitzroy Vendetta. Charlie continues running at night, even though other residents draw their curtains and shelter inside. One night Charlie confesses to Ma that he had stopped going to school in order to work for Squizzy Taylor. Ma says she knew, admitting that things have changed since his father died. Charlie promises to get a respectable job at Rosella’s when the race is over.
On the Thursday before leaving for the race in Ballarat, Charlie meets Alice outside the hospital. She is more beautiful than he remembers. His heart races as they enter the hospital. To get past the nurse, Alice invents a lie that she is Norman’s cousin. The nurse approves and sends her in with Charlie. Alice gives Norman a box of cream buns. The three talk and laugh for a long time, as though they’re old friends. Norman wishes Charlie luck in the race. Outside, Alice kisses Charlie on the cheek and gives him an envelope which he is to open once in Ballarat. Charlie walks home, thinking about the wood yard and what Daisy said about spending his money on something good. In the morning he sees only the mold on his wall. Charlie pulls out the money he earned working for Squizzy Taylor and counts it for the first time. Twenty-three pounds and five shillings—a fortune. He stuffs it into his pocket, having made up his mind how to spend it. Charlie and Mr. Redmond go to the train station. Redmond is sad to part with Clarrie the dog.
Norman’s trepidation that the growing danger around the work they are doing for Squizzy Taylor will result in someone being hurt turns out to be correct. As Norman and Charlie cut through the Fitzroy gardens, they encounter Barlow and his gang, who beat Norman until he needs hospital attention. In an act that demonstrates the themes of power, ambition, and masculinity taken to a terrible extreme, Barlow “kneecaps” Norman with a pipe, a variation on the gangland practice of shooting people in the kneecaps as punishment. By taking out his knees, Barlow ensures Norman won’t be able to compete in the next few football matches.
As a reprieve to the violent night, Charlie returns home to see that his mother has returned to her usual self. She dumps out the face powder she used symbolically to hide from the world in response to her PTSD. It seems as though Charlie’s effort to revive her spirits with dancing has brought back the mother he knows.
After training with Mr. Redmond, Charlie returns home to another pleasant surprise: Alice Cornwall knows he paid off her father’s debt, and she has come to over to give him cream buns as a thank-you gift. In reference to Charlie’s earlier memory of his father advising him to find a woman who can dance, Charlie is excited by the revelation that Alice loves to dance as much as his mother. In that moment, Charlie pictures his dead father standing in the room and winking at him, as though the man is watching over him and encouraging him to be with Alice.
The buoyant mood even continues at the hospital, where, despite his battered state, Norman tells Charlie not to worry about what happened the night before. With his spirits high, Charlie goes to Darlington Parade to learn that Squizzy Taylor’s life is falling apart. Dolly has been thrown out, and Squizzy is drinking hard while celebrating the night’s bloodshed. Squizzy's cruel indifference to Norman’s injuries lead Charlie to hand back the boots Squizzy gave him, claiming they never really fit.
Charlie’s symbolic gesture, which Squizzy accurately interprets as Charlie renouncing their association, provokes Squizzy to point a loaded gun at Charlie. In the tense moment, Charlie matches Squizzy’s power by refusing to show fear: he simply stands, assuming correctly that Squizzy Taylor will not shoot him. The gun goes off and Charlie realizes every other man has ducked. Squizzy and Charlie stand as equals. Squizzy commends him for his courage and sends him away. Having freed himself from Squizzy’s seedy world, Charlie throws himself into the honest work of training for the Ballarat mile and cultivating relationships with Alice, Norman, Redmond, and his mother.