Almost immediately after the funeral, Miss Murdstone gives Peggotty one month’s notice. The Murdstones also make it clear that they wish to see David as little as possible. When David confides in Peggotty, she proposes they visit her family in Yarmouth. Because she doesn’t want David’s presence to annoy her brother, Miss Murdstone allows David to leave.

Mr. Barkis drives them to Yarmouth, playfully flirting with Peggotty throughout the ride. He even stops at a pub where he buys them mutton and beer. Charmed by Mr. Barkis, Peggotty asks David what he thinks about her getting married to him. David replies that he loves the idea, and that the marriage would help her visit him (thanks to Mr. Barkis’s horse and carriage).

At the boathouse in Yarmouth, David observes that Little Em'ly has grown into a lovely young lady. He finds himself behaving shyly in her presence. Em’ly seems quite aware of her charms, and she is aloof toward David. He notes that her family—most especially Mr. Peggotty—has spoiled her.

Ham and Mr. Peggotty cheerfully inquire about David’s friend Steerforth, praising his handsomeness, boldness, and intelligence. Much like David, they latch onto Steerforth’s superficial attractions, failing to notice his self-centered behavior.