Scene 1
On the banks of the rhine. The Rhine maidens Woglinde and Wellgunde frolic joyfully. Flosshilde urges them to watch over the sleeping gold with greater attention. Alberich, of Nibelungen lineage, gazes lustfully at the water sprites. They play with him, pretending to want to seduce him and then repulsing him. Alberich seeks to attract them one by one but, laughing, they escape him. The gold glimmers in the water and the Rhine maidens explain to Alberich that he who forges a ring from it will possess limitless power. However no one wishes to steal the gold, for to do so they must renounce love and pleasure for eternity. Alberich is fascinated by the gold. Suddenly he snatches it from the rock, curses love and flees. The Rhine maidens bewail the lost gold.

Scene 2
A plain in the high mountains. In the distance, the morning light reveals the finished palace of the gods. Wotan, lord of the gods, and his wife Fricka gaze at their new home. It has been built by the giants Fasolt and Fafner and, in exchange, Wotan has promised them Fricka’s sister, Freia, the goddess of youth and beauty and the guardian of the golden apples that ensure the gods’ eternal youth. Fricka is concerned about this promise, but Wotan reassures her that he will not abandon Freia. The giants approach. Donner and Froh, Freia’s brothers, are horrified. Wotan is counting on Loge, the wily god of fire, to help him, but the latter does not appear. Fasolt and Fafner ask for their recompense. Seeking to win time, Wotan tries to mollify them. But Fafner knows that the gods’ power depends on Freia. Loge finally arrives but declares that he has no idea how to compensate the giants for the loss of the beautiful Freia and the delights of her love. He nevertheless mentions Alberich who has renounced love. The giants are worried by the Nibelungen’s new power. All begin to dream of possessing the ring and of stealing it from he who stole it. Fafner offers to return Freia to the gods in exchange for the gold. They carry her off with them. She has barely gone when the gods begin to experience a strange weariness. Wotan decides to go and get the gold from Alberich.

Scene 3
The nibelheim, a cave in the depths of the earth. Alberich holds the Nibelungen in slavery. With the Rhine gold Mime has forged the ring for Alberich as well as a helmet with magic powers. Now able to change form as he wishes, Alberich puts on the helmet and becomes invisible. He profits from the situation to further tyrannise Mime. Wotan and Loge appear and learn from Mime of Alberich’s new powers. Alberich arrogantly defies them. However they manage to flatter him and cast doubts on his powers. In order to dazzle them, Alberich turns himself first into a big snake, and then a toad. Wotan and Loge capture him and seize the magic helmet. They drag Alberich to the surface of the earth.

Scene 4
Wotan and Loge return with their prisoner and demand a ransom from him in return for his freedom. Alberich, thinking he can keep the ring, promises them his treasure which the Nibelungen pile up in front of the gods. Loge refuses to give back the helmet and Wotan demands the ring. When Alberich refuses, Wotan snatches it from him. Alberich fervidly curses the ring and promises death to its future owners. Free at last, he disappears. The giants return with Freia. They demand that the ransom cover her entire body. All the treasure is piled up around her, but the goddess’s hair remains visible. Fafner demands the helmet. Through a crack, Fasolt, who regrets losing Freia, can still manage to see her eyes. Only the ring can seal the crack, but Wotan refuses to give it up. Fasolt decides to leave with Freia. Erda, the goddess of wisdom, suddenly appears. She advises Wotan to give up the cursed ring. Otherwise he will only hasten the gods’ demise. All urge Wotan to obey her, and he does so, albeit unwillingly. As soon as hegives the giants the ring they begin to fight over it. Fafner strikes gives the giants the ring they begin to fight over it. Fafner strikes down his brother with a single blow. Stupefied, the gods recognise the force of the curse. Donner and Froh now unfurl a huge rainbow that will enable the gods to make their way to their gleaming palace which Wotan has named Valhalla. Watching them leave, Loge predicts their ruin. In the distance the wails of the Rhine maidens can be heard.