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Bosom buddies Valentine and Proteus bid a tearful farewell on a street in Verona. Valentine is off to improve himself, venturing out to see the world, while Proteus stays home in Verona, tied by his love for Julia. After Valentine departs, his servant, Speed, enters. Proteus inquires whether or not Speed delivered a letter to Julia, to which Speed replies affirmatively. Julia, meanwhile, asks her maid, Lucetta, with which man she should fall in love, and Lucetta recommends Proteus. Lucetta admits that she has a letter for Julia from Proteus. After much bickering, Julia tears up the letter, only to regret this act an instant later.
Antonio decides to send Proteus, his son, to the Duke's court in Milan, a decision with which neither Proteus nor Julia is particularly happy. They exchange rings and promises to keep loving each other. Meanwhile, Valentine has fallen in love with the Duke's feisty daughter, Silvia. When Proteus arrives at court, he too falls in love with Silvia, and vows to do anything he can to win her away from Valentine. When Valentine confesses that he and Silvia plan to elope, Proteus notifies the Duke of their plans, gaining favor for himself and effecting Valentine's banishment from court. Back in Verona, Julia has hatched a plan to disguise herself as a man so that she can journey to Milan to be reunited with Proteus. Upon arriving at court, she witnesses Proteus and Thurio wooing Silvia.
The banished Valentine, while traveling to Mantua, is apprehended by a group of outlaws. The outlaws, all of whom are banished gentlemen as well, demand Valentine to become their king. Since they threaten to kill him if he refuses, Valentine accepts. Silvia and Julia, who is disguised as the page Sebastian, meet when Julia delivers the ring Proteus had given her to Silvia on behalf of Proteus. Julia does not reveal her identity. Silvia calls on her friend Sir Eglamour to help her escape her father's oppressive will (he wants her to marry Thurio) and to find Valentine. However, while traveling through the forest, she and Eglamour are overtaken by a band of outlaws. Eglamour runs away, leaving Silvia to fend for herself against the outlaws. By this time, the Duke, Proteus, and Thurio, with Sebastian/Julia in tow, have organized a search party for Silvia.
Proteus wrests Silvia away from the outlaws. Valentine watches the interaction unseen. Proteus demands that Silvia give him some sign of her favor for freeing her, but she refuses. He tries to rape her for her resistance, but Valentine jumps out and stops him. Proteus immediately apologizes, and Valentine offers to give him Silvia as a token of their friendship. At this moment, Sebastian faints and his true identity becomes clear. Proteus decides that he really loves Julia better than Silvia, and takes her instead. The Duke realizes that Thurio is a thug and says that Valentine is far nobler and can marry Silvia. Valentine asks for clemency for the outlaws, and suggests that his marriage to Silvia and Proteus' marriage to Julia should take place on the same day.
