The Guardian at the Gate was surprised to see the returning travelers and especially stunned to hear that the Wicked Witch of the West was dead. The people of Oz gathered around when they heard the news. Their former rooms were restored to them and they expected to see Oz very soon. However, he kept them waiting so long that the Scarecrow had to threaten him with calling the Winged Monkeys. At this, they were summoned to the Throne Room.
When they arrived the room was empty, but they heard a great voice. It asked what they wanted, and Dorothy explained that they had come to claim their promises. The voice said it must have time to think, but the Tin Woodman protested that it had been enough time already.
The Cowardly Lion roared to frighten the Wizard, which resulted in frightening Toto, who stumbled into a screen in the corner of the room. To the group's surprise, it revealed a little old man, bald of head and very wrinkled. The Tin Woodman asked who he was and he responded that he was Oz. This astonished everyone, especially when he explained that all those other guises were mere make-believe. The Scarecrow accused him of being a humbug, to which he assented in dismay. Oz said he had fooled everyone so long that he was secure of never being found out.
Oz also explained how he had conceived of the head, woman, beast, and ball of fire. He told his own story: he was born in Omaha and became a ventriloquist and then a balloonist in the circus. One day the balloon was caught by a current of air that carried him miles away to this strange and beautiful land. The people thought he was a great wizard and he went along their misunderstanding, even commanding them to build the Emerald City. Oz even duped the citizens of Emerald City into thinking everything they saw was green; the goggles they wore colored the world. Despite his sway over the land, Oz feared the witches because they had real power, especially the two evil witches. That was why he commanded Dorothy and her friends to kill the Witch of the West.
Dorothy told him he was a bad man, but he replied that he was not a bad man, just a bad Wizard. The Scarecrow, Tin Woodman, and Lion asked for their gifts, and when Oz told them they already had brains, a heart, and courage, respectively, they were not contented. He thus told them to return the next morning and he would give them what they asked. As for Dorothy, he said he needed two or three days to figure out how to get her home to Kansas. He asked in return for his secret to be kept, and they agreed. Dorothy believed she would forgive him if he got her home.
The next morning the Scarecrow visited Oz. Oz opened his head and placed within it bran mixed with pins and needles that was his new, glorious brain. The Scarecrow joyously said he felt very wise. For the Tin Woodman, he gave him a silk heart stuffed with sawdust; he opened the tin body, put the heart inside, and soldered it closed with a patch. For the Lion, he commanded him to drink the contents of a little vial poured into a gold dish. This was his courage.
Dorothy's friends were happy but she waited sadly for news from Oz. He finally summoned her and told her his plan: he would fashion a balloon and sail across the desert and then figure out how to get to Kansas. He even said he would go with her because he was tired of being a humbug and wanted to be back in the circus.
Dorothy helped Oz sew the silk balloon. Once the basket was made, Oz wished his people goodbye, telling them he was going to visit his powerful brother wizard in the clouds. The Scarecrow, who was very wise, would rule over them in his stead. The Wizard got into the balloon and called for Dorothy. Unfortunately, she was trying to grab Toto when the ropes on the balloon cracked and it rose into the air without her. That was the last anyone ever saw of the Wonderful Wizard of Oz, and the people grieved for him.
Dorothy was sad to see Oz go but decided she was glad she did not go up in the balloon. Her friends wondered if she might want to live in the Emerald City, but she was sure she wanted to go back to Kansas. She called upon the Winged Monkeys for the second time to see if they would take her over the desert, but they refused since they could not leave the country. Dorothy was extremely disappointed, but the soldier told her that she might try Glinda, the Good Witch of the South. She resolved upon this plan and all of her friends agreed to travel with her once more.
The next morning the group embarked, walking along in the best of spirits and talking gaily together. The second day they came to a great wood and had to enter because there was no way to go around it. The first trees tried to keep them out but the Tin Woodman cut them a path. They finally came to a high wall made of white china and realized they must climb over it.
In these chapters the companions learn that Oz is not what he seems: he is a regular man who took advantage of the credulity of the denizens of the future Emerald City to attain a position of power for himself. Although he did not do so with malicious intentions, he nonetheless is the epitome of a humbug, as the Scarecrow labels him accusingly. He is full of sound and fury and cannot actually grant the wishes that Dorothy and her friends ask for. However, he is not completely lacking in wisdom – he is able to, through small sleights of hand, give the Scarecrow, Tin Woodman, and Lion exactly what they already possessed within themselves. He does come up with a plan to take Dorothy home, but in a moment that resembles the earlier scene where Toto prevents Dorothy from getting into the storm cellar, she misses the basket trying to find the dog.
The simplicity and utopian quality of the Oz novels often provoke critics to look for deeper meaning in the text (see other analyses in this study guide). Fred Erisman offers his take on the novel's relationship with progressivism in his influential 1968 article. He explains that Baum's books in general "illustrate one American's commitment to the older value system, his tacit recognition of the dilemma posed by this commitment, and the resolution he evolved for himself and his readers."
Oz as a fairyland is contrasted with the rural land of Kansas. Dorothy is drawn in an ideal fashion. In Oz, generosity "is the basis of the entire economy" and money is unnecessary. Even though the Emerald City is opulent, those who live throughout Oz live simple lives. Sophistication does not hold any sway here. Another facet of the Oz books is their touting of individualism. Baum "gives to the people of Oz an unfailing respect for the individual" and sees no "conflict between simplicity and individualism; the two are wholly compatible." Self-reliance, originality, and resourcefulness are also important, and draw comparisons with the writings of Benjamin Franklin.
There is also, Erisman notes, a "firm belief in the virtues of industry". Even though Oz does not seem to require work its inhabitants do it anyway, and they do it cheerfully. In other Oz books Baum's views become clear: "work is an end unto itself and its chief benefits come as much from the effort as from the achievement."
The rural values that Baum supported are present in his idealized world. They do not, however, translate over to the real world. An ideal individual cannot really function in the real world; "only in the imaginary world...is this system viable." Looking at the course of the Oz books makes it apparent that as Baum noticed the harsh reality of his actual environment, he deepened the perfection and pastoral nature of his utopia. This was his answer to the problems of Progressivism, for he was now aware that the ideal state must be built of 20th century America; this was difficult because "Baum and the Progressives were faced with the inadequacy of traditional values in the modern world." By writing for children Baum hoped that he was helping to mold the adults of the future who would understand the dual nature of their flawed but perfect world.