The bandits quickly retreat from the camp during a second assault, scared off by the sight of a marching squadron of Federales squeezing them in a potential cross-fire. Dobbs calls his friends to a promontory, thrilled by the sight of the cavalry in galloping pursuit of the bandits:

...Here's a sight if there ever was one. Federales, look at 'em. I could kiss every one of 'em...Oh, go get 'em. Sic 'em Tige! Chew 'em up and don't spit 'em out - swallow 'em. Oh am I happy. To tell you the truth, I was already eatin' dirt.

While looking through Cody's belongings, they find that his name is James Cody, from Dallas, Texas. His wallet contains a snapshot of his pretty wife. Howard opens a letter from an envelope, and starts to read outloud (assisted by Curtin), learning that he left them ("life's real treasure") to search for gold ("material treasure"). The poignant, handwritten letter that Cody recently received from his devoted wife and family evokes the warmth of a loving group - more valuable than the happiness the gold they have discovered can buy:

Dear Jim:
Your letter just arrived. It was such a relief to get word after so many months of silence. I realize, of course, that there aren't any mailboxes that you can drop a letter in out there in the wilds, but that doesn't keep me from worrying about you. Little Jimmy is fine, but he misses his daddy almost as much as I do. He keeps asking, 'When's Daddy coming home?' You say if you do not make a real find this time, you'll never go again. I cannot begin to tell you how my heart rejoices at those words if you really mean them. Now I feel free to tell you. I've never thought any material treasure, no matter how great, is worth the pain of these long separations.
The country is especially lovely this year. It's been a perfect spring - warm rains, and hardly any frost. The fruit trees are all in bloom. The upper orchard looks aflame and the lower like after a snowstorm. Everybody looks forward to big crops. I do hope you are back for the harvest.
Of course, I'm hoping that you will at last strike it rich. It is high time for luck to start smiling upon you, but just in case she doesn't, remember we've already found life's real treasure. Forever yours, Helen.

The passage describing the fruit tree harvest resonates in Curtin's ears. The letter from Cody's wife moves all of them and beckons them to return from the arid wilderness to a more rooted, fertile existence. The three prospectors bury Cody's body and soon after, they wearily conclude that "we've taken about all the gold this here mountain has." Having collected about $35,000 apiece, they agree to call it quits, pack up, and leave the mountain. Dobbs seems inspired by the possibility of a loving female back in civilization ("I don't want to keep that dame waiting, whoever she is").

Before they depart to return to civilization and end their exploitation of the 'feminine' mountain, Howard insists that they dismantle and close up the mine shaft to restore it - he reveres the land like it was a raped or wounded woman. Even Dobbs is thankful for the sustenance and treatment he received from the earth:

Howard: It'll take another week to break down the mine and put the mountain back in shape...Make 'er appear like she was before we came...We've wounded this mountain and it's our duty to close her wounds. It's the least we can do to show our gratitude for all the wealth she's given us. If you guys don't want to help me, I'll do it alone.
Curtin: You talk about that mountain like it was a real woman!
Dobbs: She's been a lot better to me than any woman I ever knew!

The three put their sacks of gold in hides, and load them onto the backs of the burros. Each man is to be responsible for his own burro and goods. As they start down off the mountain, Howard is the first to express a grateful farewell, waving affectionately back:

Howard: Bye mountain, thanks.
Dobbs (imitating): Yeah, thanks, mountain.
Curtin (waving): Thanks.

Around their night campfire, Curtin decently decides that he will give Cody's widow and son a partner's fourth, because Cody helped save their lives. Howard agrees: "The buzzards would have gotten fat on us, all right." Dobbs, however, back in character - greedily resists and ridicules their naive idea:

Are you crazy?...You two guys must've been born in a revival meeting.

Out of the shadows of the jungle, "company" approaches. A group of four friendly native peasants/Indians appears, first sharing tobacco and a smoke. The Indians mistake Howard for a medicine man and request that he accompany them to their village. The leader's dying little boy, who fell into the river earlier in the day and partially drowned, is unconscious. Howard immediately agrees to go, and asks that Cody and Dobbs watch after his goods while he's gone (probably until morning).

In the primitive Indian tribal village where he is surrounded by the solemn-faced, assembled villagers (in a high-angled shot), the old man attends to the comatose boy who lies motionless on a table. Throughout the night in a ritualistic setting, Howard treats and saves the boy who is near death by methodically moving his arms up and down (a form of artificial respiration), putting a teaspoonful of tequila in the stunned boy's mouth, placing wet towels on the boy's abdomen, and rubbing the boy's hands. When the child finally stirs, murmurs a groan, sits up on the altar-like platform (a resurrection of sorts), and opens his eyes - it is a life-affirming miracle to the awed onlookers. In reverence, the men remove their sombreros and everyone genuflects.

The next scene finds Howard having returned to Curtin and Dobbs the next day, leading their burros along a trail through cactus. Howard explains the miracle, enjoying the pretense of power the Indians thought he was endowed with: "Artificial respiration did it and a few Boy Scout tricks. I think it was more shock than drowning. He hadn't swallowed much water. Maybe he was stunned while diving." The sound of horsemen is heard - the Indians from the night before, led by the father of the little boy, ride up and hospitably invite all of them back to the village. They must pay off their debt to "all the saints in heaven" - otherwise they would be affronted and angry:

He's insisting we return with him to his village and be his guests...He says if he doesn't pay off his debt, all the saints in heaven will be angry. (Dobbs laughs.) This is no laughing matter. I'm afraid he's determined to take us with him, even if it means force.

Dobbs incurs the wrath of the villagers, and their machetes, when he refuses their hospitality. Since it is "no laughing matter," Howard realizes his obligation to return with them to the village to receive their gratitude: "He says it don't make any difference about you guys, but I have to come." Misjudging his partners' goodness, Howard reluctantly lets them keep his "goods" - until he can rejoin them a few days later in Durango. Dobbs reminds him of the reason for his detention and for the peasants' hospitality:

I'll let you remember this the next time you try to do a good deed!

Dobbs also bids farewell - tongue-in cheek: "We'll be lonesome without you, but you know my Sunday school teacher used to say, 'You've got to learn to swallow disappointments in this sad life.'" The old prospector jokes back about marrying one of the Indian "dames" in the village:

Pick me out a good-looking squaw and marry her. They're easy to dress and feed and entertain. They don't nag at you either. Well, so long partners.

Howard rides away with the Indians, looking back furtively toward them, with some misgivings about trusting his partners. For the first time in the film, they are left without him - the latent malignancies and nightmares festering in Dobbs come uncontrollably to the surface. Struggling along the trail, Dobbs becomes edgy, resentful and irritable, complaining about Curtin's offer to carry Howard's goods: "Ain't it always his burros that won't march in line...What was in your head when you offered to carry his goods for him that he couldn't manage by himself. He knew what he was doin' when he turned 'em over to us. Mighty cute of him, wasn't it?" The two men are soon bickering and at each other's throats, questioning each other's authority and leadership:

Curtin: You talk like you're boss of this outfit.
Dobbs (standing and challenging him): Maybe you are. Let's hear you say it.

Deciding to camp for the night, Dobbs and Curtin are by the campfire when Dobbs bursts out with a deranged laugh - and then justifies his plan to take Howard's goods:

I was just thinkin' what a bonehead play that old jackass made when he put all his goods in our keeping...Figured to let us do his sweatin' for him, did he? We'll show him...Oh man, can't you see? It's all ours. We don't go back to Durango at all, savvy? Not at all...Don't be such a sap. Where did you ever grow up? All right, to make it clear to a dumbhead like you - we take all his goods and go straight up north and leave the old jackass flat.

Essentially moral and honest, Curtin objects to Dobbs' treacherous idea to betray Howard. Without any tempering or restraining influences, old animosities emerge in the wilderness. Dobbs projects his own scheme of betrayal onto Curtin:

Curtin: You aren't serious are you? You don't really mean what you're saying?
Dobbs: Fred C. Dobbs don't say nothin' he don't mean.
Curtin: As long as I'm here and can do anything about it, you won't touch a single grain of the old man's goods.
Dobbs: I know exactly what you mean. You want to take it all for yourself and cut me out.
Curtin: No, Dobbs. I'm on the level with the old man. Just as I'd be on the level with you if you weren't here.
Dobbs: Get off your soapbox, will you? You only sound foolish out here in this wilderness. I know you for what you are. For a long time, I've had my suspicions about you and now I know I've been right.
Curtin: What suspicions are you talking about?
Dobbs: Oh, you're not puttin' anything over on me. I see right through you. For a long time, you've had it in your mind to bump me off at the first good opportunity and bury me out here in the bush like a dog. So's you could take not only the old man's goods but mine in the bargain. And when you get to Durango safely, you'll have a big laugh, won't ya, thinkin' how dumb the old man and I were?

Dobbs draws his gun on Curtin, fearing that he will lose his wealth to his partner: "Was I right or was I? You and your Sunday school talk about protectin' people's goods. You. (Yelling) Come on, stand up and take it like a man." Curtin jumps towards Dobbs' legs, knocking him backward as the gun discharges. Curtin disarms Dobbs and draws his own gun on him: "The cards are dealt the other way now, Dobbs." But Curtin vows that he never intended to rob him or do him any harm. Curtin empties the bullets from Dobbs' gun [the gun, emptied of cartridges, will prove fatal for Dobbs in a later scene] and returns it to him, and then suggests that they separate either that night or the next day.

Delusional, Dobbs is convinced that Curtin plans to sneak up from behind [with a veiled homosexual reference], murder him and steal his gold:

Dobbs: So you could fall on me from behind, sneak up, and shoot me in the back.
Curtin: All right, I'll go first.
Dobbs: And wait for me on the trail and ambush me?
Curtin: Why wouldn't I do it right here and now if I meant to kill you?
Dobbs: I'll tell you why. 'Cause you're yella. You haven't got nerve enough to pull the trigger while I'm lookin' you straight in the eye.
Curtin: If you think like that, there's nothing to do but to tie you up every night.
Dobbs: (He laughs.) I'll tell you what. I'll make you a little bet. Three times thirty-five is a hundred and five. I'll bet ya a hundred and five thousand dollars you go to sleep before I do.

After a night of desperately fighting off sleep to outlast Dobbs, Curtin is groggy from exhaustion and stumbles along the pack trail with Dobbs in the lead. Dobbs sees that Curtin's eyes are almost closed and lets the train pass. But Curtin opens his eyes and sees Dobbs almost abreast of him behind a tree, just in time to reach for his gun and order his adversary to get up ahead of the train. Like the night before, the two men tensely face each other in another game of cat-and-mouse next to their campfire. When Curtin's eyes droop and he falls onto his bed roll, Dobbs goes over to him, takes his gun, kicks him awake, and threatens to kill him - with a wolfish countenance:

Dobbs: The cards are dealt the other way now and for the last time no more shuffling...I'm gonna finish this right now. No more takin' orders from you like I had to do today. Get me?
Curtin: You mean you're gonna murder me?
Dobbs: No brother, not murder. No. Your mistake. I'm doing this to save my life that you'd be taking from me the minute I wasn't lookin' at ya.
Curtin: The old man will catch up with ya.
Dobbs: Oh he will, will he? Well, I got an answer for that one too. You know what I want to tell him? I want to tell him you tied me to a tree and made your getaway taking all the goods - yours, mine, and his. So they'll be looking for you and not me. (Pulling Curtin to his feet.) Up. March. Today I had to march to your music - now you march to mine.
Curtin: Where?
Dobbs: To your funeral. (Dobbs pushes him into the brush - off-camera.) Come on, keep going. Get up. Sleepy huh? You'll be asleep soon enough. Sound asleep.

Two gunshots sound as Curtin is shot offscreen [with Curtin's gun] in the dark. Dobbs staggers back toward the campfire, mumbling to himself as his mind deteriorates. He doubts and fears whether his aim was accurate and Curtin is actually dead:

Maybe I didn't kill him. Maybe he just staggered and fell down without being hit.

He takes a flaming piece of burning wood from the fire and rushes back toward the body. Curtin lies motionless where Dobbs had left him. He leans over and waves the flame back and forth over Curtin's face, but he can't fire again. Then he straightens up, backs away, and throws Curtin's gun at the feet of his corpse. Back at the campfire where he lies down, guilt and revulsion grow inside. He mutters: "I'll dig a hole for him first thing in the morning." Then, his conscience begins to bother him about the evil murder, although he wishes to repress his anxiety:

Conscience. What a thing. If you believe you've got a conscience, it'll pester you to death. But if you don't believe you've got one, what can it do to ya? Makes me sick all this talking and fussing about nonsense.

The flames of the fire crackle and grow larger and larger - representing the heat of Hades. Eventually, they cover Dobbs' demonic face - bearded, dirty and heavily in shadow - as he stares into the hot fiery inferno. Curtin's shooting is not fatal, but he is badly wounded. He crawls to safety and is found by some Indian villagers.

The next morning, Dobbs loads up the burros and then decides to bury Curtin. As he starts into the bush, he is panicked about the murder and any trace of the deed - his dementedness and insanity cause him to talk to himself about whether to bury the guilty evidence or not. Lacking courage, he imagines being repulsed by looking at the victim's corpse. When he can't locate the body, he convinces himself that a tiger devoured the missing body. He leaves Curtin for dead:

Maybe I'd better leave him like he is. Ain't very likely anybody will find him. In a week's time, the buzzards and the ants will have done away with him anyway. (A tiger's cry startles him.) I don't know what's getting into me. Was that really a tiger? (He moves again toward the bush.) No. What if his eyes are open, looking at me? Best thing to do is to get to the railroad in a hurry. (He turns away and goes back to the burros, starting to lead them away as he resumes his argument with himself.) It's better not to have buried him. I did right, yeah! What I should have done, maybe, bury his clothes and leave him to the ants and the buzzards...Buzzards! If somebody saw them circling, they'd know something was dead. (He turns and looks back.) Buzzards ain't spotted him yet. Lucky for me. (He removes his spade from one of the packs and runs back to the campfire and bush, but cannot find Curtin's body.) Curtin! Curtin! Curtin! Where are you? Curtin! I gotta get ahold of myself! Mustn't lose my head. There's one thing certain, he ain't here. I got it. The tiger. Yeah, yeah that's it. The tiger must have dragged him off to his lair, that's what. Yeah, pretty soon, not even the bones will be left to tell the story. (He lets go a delighted, but deranged laugh.) Done as if by order.

At the village in images of primal innocence, the camera moves down from the tree canopy and finds Howard reclining on a hammock as a reward for the healing of the boy. He is being attended to in the shade by native Indian girls, fanned and fed watermelon while enjoying sips of tequila. Gifts are presented to him - a caged bird and a squealing baby pig. Behind him, children dive and splash in a pool of water. But then he is interrupted by the Indians who have discovered Curtin in the bush. Howard is brought to Curtin and while his wounds are washed, Curtin vengefully vows: "I'll pull out of this if only to get that guy." After listening to his story, Howard understandingly recognizes the greed and violence that Dobbs chose in his heart:

Mr. Dobbs has made off with our goods and is on his way north. Well, I reckon we can't blame him too much...He's not a real killer as killer's go. I think he's as honest as the next fella - or almost. The big mistake was leaving you two fellas out there in the depths of the wilderness with more'n a hundred thousand between ya. That's a mighty big temptation, partner, believe me...Maybe if I'd've been young and been out there with either one of you, I might have been tempted too.

Howard decides to go in search of the "thief" and get their goods back. Although weakened by his wounds, Curtin refuses to be left behind. They ride off in pursuit of Dobbs - with a posse of villagers. They come upon a dead burro from Dobb's burro train.

Nearby, Dobbs' gaunt face is parched and dry as he stumbles and staggers along half-conscious in the sweltering desert, seeing ahead of him before his burro train some sanctuary ruins. When he spots a pool of muddy, fetid water, he must push past the burros down a trench to kneel and bury his face deep in the life-restoring liquid. As he feverishly drinks from the watering hole, a reflection of another face is shown in the pool - it is the image of death itself - the smiling bandit Gold Hat with his tattered, ragged sombrero. Joined by two other predatory bandits, Gold Hat asks for a cigarette and matches. Dobbs cleverly attempts to answer Gold Hat's questions, appearing unworried and unafraid, although he knows he is defenseless without his partners. As they prepare for the kill, Dobbs is surrounded and looked up and down - one of the bandits lifts Dobbs' pants leg to examine his boots.

Gold Hat suddenly thinks he recognizes Dobbs from their encounter in the mountains:

Hey, do I know you from some place? Maybe I know you?...Are you alone?...

Truly isolated from others by his possessions, Dobbs answers that a couple of his friends are coming along on horseback, but Gold Hat isn't convinced: "That's funny. A man all by himself in bandit country with a string of burros and his friends behind him on horseback." Then he remembers: "I know who you are! You're the guy in the hole - the one who wouldn't give us the rifle - hah, hah, hah, hah." They ask what is in the bags on the burros' backs - Dobbs replies that he has animal hides for sale in Durango, and then tries to get his burro train to start for the trail. Gold Hat threatens: "We can sell those burros for just as good a price as you can." Dobbs draws his unloaded gun at his nemesis when taunted: "Get away from my burro, I tell ya!" But his revolver clicks empty three or four times. They laugh at Dobbs for his impotence and then one of the bandits hits him in the head with a stone. Gold Hat savagely finishes him off with a few strokes of a machete blade.

As a sort of poetic justice for his greed, the impoverished bandits strip Dobbs for his boots and clothing, animal skins, and burros. His divisiveness is passed onto his murderers - two of the bandits competitively quarrel over the dead man's belongings, paralleling the struggle over gold among the three prospectors. As they argue among themselves, the pack mules run off toward the ruins of a religious sanctuary and they give chase - one of the three comically wears Dobbs' pants. [Huston would reprise the same lusting after shiny boots by roving tribesmen in The Man Who Would Be King (1975).]

At the mission ruins, the bandits are unaware that the burros' bags that they dump to the ground and slash open contain gold dust. They believe they have been swindled - that their victim was weighing down his hides with sand bags to increase their value.

In Durango's village plaza (overshadowed by an imposing church tower), the bandits appear with the burro train, attempting to sell the pack animals and stolen hides back to the general store. A young Mexican boy, who months earlier had seen the prospectors purchase the specially-branded burros, informs the storekeeper. The observant man notices the attire of the bandits - they wear the boots and trousers of an American prospector. The bandits are circled and surrounded by the villagers with machetes and guns drawn, and then led into a holding prison while the Federales are summoned. Gold Hat animalistically snarls and glares out from behind wooden bars - fearful but maddened. At the same time, Howard, Curtin, and the Indians approach the mission ruins on horseback.

The Federales' firing squad is swiftly prepared to execute the three bandits against a wall in front of their own freshly-dug graves. The three bandits are hidden from view by the wall when they are lined up. A large white cross stands prominently in the background behind the executioners. Gold Hat's final request is to wear his sombrero during the execution, and he runs to pick it up before returning to the wall. Howard and Curtin hear a volley of shots as they ride into town with their Indian escorts. The northern wind, picking up again, blows Gold Hat's sombrero across the dusty ground into his fresh grave after the execution. From the storekeeper, Howard learns of Dobbs' own fate and the recovery of their goods: "Dobbs is dead...Bandits got him...He says our goods are safe in his office."

In the general store, they find everything - saddles, hides, canvas coverings, canteens, etc, but are dismayed that there are no bags of gold. The young Mexican boy tells what he heard the uncomprehending bandits say about the bags ("los sacos") - they mistook the gold dust for sand at the mission: "...he heard the bandits talking while they were waiting to be shot...they thought it was bags of sand hidden in among the hides to make them weigh more when Dobbs went to sell them in Durango." Curtin is impatient and shouts: "Where are they?" They learn the bags are at the ruins outside of town.

While they ride hurriedly to the ruins, a very fierce windstorm rises up and high winds blow the gold dust away and disperse it - mingling it with the common earth [recalling the wise words of the Biblical Book of Ecclesiastes 3:20, and Stanley Kubrick's homage in The Killing (1956) - the incredible visual shot of an airplane propeller blowing away a suitcase's stolen money all over the airport runway]. In the final scene when Howard and Curtin discover the empty, scattered-about, and ripped gold bags, Howard is at first dumb-struck. But then the wise man tells his dumbfounded pal, while roaring with triumphant, mocking, restorative laughter (in one of cinema's greatest moments), of the magnificent irony of their situation. They find themselves the victims of cruel fate - that the desert winds have blown away their treasure:

Oh laugh, Curtin, old boy. It's a great joke played on us by the Lord, or fate, or nature, whatever you prefer. But whoever or whatever played it certainly had a sense of humor! Ha! The gold has gone back to where we found it!... (Curtin joins Howard in boisterous laughter.) This is worth ten months of suffering and labor - this joke is!

As they walk away and sit down to contemplate what they will do next, while still laughing, Howard waves at the mountain. Collapsing against a wall, both decide it's easy to accept what has happened ("the worst ain't so bad when it finally happens") when compared to Dobbs' lost soul and wasted life. Now that he is "fixed" for life and venerated by the Indians, Howard desires to philanthropically use the gift of his share of money (from the proceeds of the sale of the burros, tools, and hides) to help Curtin [who functions symbolically as his son] visit Cody's widow and family in Dallas at fruit harvest-time (to find "life's real treasure"):

Curtin: Well Howard, what next, I wonder?
Howard: Well, I'm all fixed as far as I'm concerned as a medicine man. I'll have three meals a day, five if I want 'em, and a roof over my head, and a drink every now and then to warm me up. I'll be worshipped and fed and treated like a high priest for telling people things they want to hear. Good medicine men are born, not made. Come and see me some time, my boy. Even you will take off your hat when you see how respected I am. Why only the day before yesterday, they wanted to make me their Legislature - their whole Legislature. I don't know what that means but it must be the highest honor they can bestow. Yeah, I'm all fixed for the rest of my natural life. How about yourself? What do you aim to do?
Curtin: I haven't got any idea.
Howard: Oh, you're young yet. You've got plenty of time to make three or four fortunes for yourself.
Curtin: You know, the worst ain't so bad when it finally happens. Not half as bad as you figure it will be before it's happened. I'm no worse off than I was in Tampico. All I'm out is a couple hundred bucks when you come right down to it. Not very much compared to what Dobbsie lost.
Howard: Any special place you're bent on goin'?
Curtin: Naw, all the places are the same to me.
Howard: Tell you what. You can keep my share of what the burros and the hides'll bring if you use the money to buy a ticket to Dallas. See Cody's widow. Better than writin'. And besides, it's July and the fruit harvest. How about it? (Howard takes Cody's wallet and letter out of his pocket and hands them to Curtin.)
Curtin: It's a deal.

With the mountains looming above them in the distant background, they mount their horses and shake hands goodbye, wishing each other good luck. Howard and Curtain choose different paths to travel - Howard rides off toward the mountains with the Indians, turning and waving back. Curtin waves back and rides away in a different direction. As he passes, the camera pans to the ground and shows a closeup of a small, forked cactus - the film's epilogue. Caught on one of its forks is one of the torn, empty gold bags - recalling the tragic fate of Dobbs in his mad quest.