Joe returns to Trigger Whisky Saloon, where, in another display of fighting skill, he wins the customers back to Kolaloka once again ("Můj bóže, můj bóže"). Hogofogo, in disguise, attempts to shoot Joe, but Joe instead engages him in a gunfighting chase through the town, trying to force him into signing a testimonial in favor of Kolaloka. Though Hogofogo seems momentarily to have the upper hand ("Horácova polka"), Tornado Lou attacks Hogofogo and saves Joe's life. Joe, too commercially oriented to understand her devotion, spurns her advances. In misery, she vows to help the Badmans lure Joe to his death. Their plan begins with Hogofogo, now disguised as a blind piano tuner ("Horácův pohřební blues"), kidnapping Winnifred as a bait to lure Joe to Dead Man's Valley ("Balada Mexico Kida"). There, the Badmans' henchmen, led by Grimpo, capture him and torture him, but Lou has a change of heart and saves his life again, reuniting him with Winnifred. Meanwhile, Hogofogo waits for his henchmen to deliver Winnifred to his room. Instead, Joe appears and forces him to sign the testimonial. Hogofogo, taking advantage of Joe's aversion to spirits, ambushes him with a volley of gunshot and leaves him dead.