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Tamiya Iemon, a rōnin, is having a heated exchange with his father-in-law, Yotsuya Samon, concerning Samon's daughter Oiwa. After it is suggested by Samon that Iemon and his daughter should separate, the ronin becomes enraged and murders Samon. The next scene focuses on the character Naosuke who is sexually obsessed with Oiwa's sister, the prostitute, Osode, despite her being already married to another man, Satô Yomoshichi.
As this scene begins, Naosuke is at the local brothel making romantic advances toward Osode when Yomoshichi and the brothel's owner, Takuetsu, enter. Unable to pay a fee demanded by Takuetsu, he is mocked by both Yomoshichi and Osode and forcibly removed. Shortly thereafter an intoxicated Naosuke murders Okuda Shôzaburô, his former master, whom he mistakes for Yomoshichi. This is implied to occur at the precise time of the slaying of Samon.
It is at this point that Iemon and Naosuke unite and conspire to mislead Oiwa and Osode into believing that they will exact revenge on the persons responsible for their father's death. In return Osode agrees to marry Naosuke. Oume, the granddaughter of Itô Kihei, has fallen in love with Iemon.
However, believing herself to be less attractive than Oiwa, she doesn't think Iemon will ever want to become her husband. Sympathizing with Oume's plight, the Itôs scheme to have Oiwa disfigured by sending her a topical poison disguised as a facial cream. Oiwa, unbeknown to her at the time, is instantly scarred by the cream when she applies it.
Upon seeing his wife's ghastly new countenance, Iemon decides he can no longer remain with her. He asks Takuetsu to rape Oiwa so that he will have an honorable basis for divorce. Takuetsu cannot bring himself to do this so, instead, he simply shows Oiwa her reflection in a mirror. Realizing that she has been deceived, Oiwa becomes hysterical and, picking up a sword, runs towards the door. Takuetsu moves to grab her but Oiwa, attempting to evade him, accidentally punctures her own throat with the sword's tip. As she lies bleeding to death before a stunned Takuetsu, she curses Iemon's name. Not long after Iemon becomes engaged to Oume.
It closes with Iemon being tricked by Oiwa's ghost into slaying both Oume and her grandfather on the night of the wedding. The remaining members of the Itô household are annihilated. Iemon kicks Oyumi, the mother of Oume, into the Onbô Canal and Omaki, the servant of Oyumi drowns by accident.
Naosuke arrives in disguise as Gonbei, an eel vendor, and blackmails Iemon into handing over a valuable document. Iemon contemplates his prospects while fishing at the Onbô canal. On the embankment above the canal Iemon, Yomoshichi and Naosuke appear to fumble as they struggle for possession of a note which passes from hand to hand in the darkness.
At the opening, Naosuke is pressuring Osode to consummate their marriage, to which she seems oddly averse. Yomoshichi appears and accuses Osode of adultery. Osode resigns herself to death in atonement and convinces Naosuke and Yomoshichi that they should kill her. She leaves a farewell note from which Naosuke learns that Osode was, in fact, his own younger sister. For the shame of this, as well as for the killing of his former master, he commits suicide. Iemon, still haunted by the ghost of Oiwa, flees to an isolated mountain retreat. There he rapidly descends into madness as his dreams and reality begin to merge and Oiwa's haunting intensifies. Yomoshichi slaying Iemon out of both vengeance and compassion.
The History of the Ghost Oiwa
Oiwa is an onryo, a ghost who seeks vengeance. Her strong passion for revenge allows her to bridge the gap back to Earth. She shares most of the common traits of this style of Japanese ghost, including the white dress representing the burial kimono she would have worn, the long, ragged hair and white/indigo face that marks a ghost in kabuki theater.
There are specific traits to Oiwa that set her apart physically from other onryo. Most famous is her left eye, which droops down her face due to poison given her by Iemon.
This feature is exaggerated in kabuki performances to give Oiwa a distinct appearance. She is often shown as partially bald, another effect of the poison. In a spectacular scene in the kabuki play, the living Oiwa sits before a mirror and combs her hair, which comes falling out due to the poison. This scene is a subversion of erotically-charged hair combing scenes in kabuki love plays. The hair piles up to tremendous heights, achieved by a stage hand who sits under the stage and pushes more and more hair up through the floor while Oiwa is combing.