At her soirée, Flora learns from the Marquis that Violetta and Alfredo have parted ways. The floor is cleared for a band of fortune-telling Gypsies and dancers. Gastone and a group of men dressed as bullfighters offer a song about a matador and his coy sweetheart. Alfredo arrives, gambling recklessly and making bitter comments about love. Violetta, nervous and pale, enters on the arm of her old admirer, Baron Douphol, who proceeds to lose a small fortune to Alfredo. When the guests file into an adjoining room for supper, Violetta intercepts Alfredo, imploring him to leave before he further angers the baron. Misinterpreting her apprehension as concern for her new protector, he asks whether she loves Douphol. Bound by her promise to Germont, she replies that she does. Alfredo, mad with jealousy, calls the other guests to witness that he has repaid the money she squandered on him, then hurls his winnings at her feet. The guests rebuke him. Germont enters and berates his son, who is stricken with remorse, and Douphol challenges his rival to a duel.
In Violetta's bedroom, Dr. Grenvil tells Annina her mistress hasn't long to live. Tuberculosis is consuming her. When she awakens, Violetta rereads a letter from Germont telling her the baron was only wounded in his duel with Alfredo, who knows of her sacrifice and is on his way to ask her pardon. Sensing that it is too late, Violetta bids farewell to her past. After Mardi Gras revelers pass by outside, Alfredo arrives. The lovers dream of a new life away from Paris, but Violetta falters and cries out against approaching death. Germont comes in with the doctor, as Violetta gives Alfredo a small portrait of herself, urging him to give it to the woman he will marry. Seized with a last resurgence of strength, she rises, crying out that she feels life returning, then falls dead.