An old shepherd Baldassarre, tells a story to l'Innocente, a younger son of Rosa Mamai about a little goat fighting with a hungry wolf all night long (Come due tizzi accesi). At the break of dawn the goat collapses and dies. L'Innocente is slightly retarded and rumour has it that the child brings good fortune to the household. l'Innocente is neglected by everyone in the family except Baldassarre.
Rosa Mamai is worried about her older son Federico, who is madly in love with a woman from Arles. She asks her brother, Marco to gather some information about this unknown woman.
Vivetta arrives at the farmhouse. She has always loved Federico but she feels hurt knowing of Federico's obsession for l'Arlesiana. Rosa and Vivetta were talking to each other when she sees l'Innocente up on the edge of the window. Baldassarre pulls the child back, and Rosa shudders, If anyone should ever fall from that height!. Federico enters. Shortly after that, Marco returns with a news from Arles. Marco says Rosa has no choice but to consent to the marriage plans.
While Baldassarre is at the farmyard, he was approached Metifio, who asks to speak to Rosa. Metifio tells Rosa that he is l'Arlesiana's lover and the girl's parents are aware of their relationship but decided reject him when the prospect of marriage with Federico arose. He shows Rosa and Baldassarre two letters to prove his statements. When Metfio left, Federico enters. His mother showed him the letters and asks him read them. Federico feels devastated over the treachery of the woman he loves.
Rosa and Vivetta search for Federico around the countryside. He has disappeared from home since the previous day. Rosa convinces Vivetta to behave more seductively with Federico to distracting him from thoughts of l'Arlesiana. Baldassarre and l'Innocente enter.
I'Innocente discovers Federico has been hiding in the sheepfold. Baldassarre urges Federico to forget his sorrow by helping him with work (Vieni con me sui monti). After Baldassarre has gone, Federico pulls out the letters and contemplates them bitterly. L'Innocente falls asleep while repeating a line from the old shepherd's story about the goat, and that leads into Federico's lament (È la solita storia del pastore).
Vivetta enter and awkwardly tried to follow Rosa's advice to seduce Federico. She tells him that she loves him but Federico could not accept it and rejects her. Vivetta sobs and draw Rosa to the scene. Rosa offers her consent to his marriage with l'Arlesiana. Federico is moved by his mother's offer but he refuses, swearing that he will only give his name to a woman worthy of it. He calls for Vivetta and asks her to help him to forget about the woman he loves.
Act 3 begins with the preparations for Federico and Vivetta's wedding. Federico affirms that he is now only thinks of Vivetta. Metifio enters and runs into Baldassarre. He asks him to return back his letters but Baldassarre says he had delivered the letters to Metifio's father. Metifio hadn't received them because he was at Arles. Metifio reveals his plans to kidnap l'Arlesiana. Federico overheard the conversation and is overcome with the old jealousy. Vivetta pleads with him to move on and go with her.
Baldassarre advises Metifio not to ruin his life for the unworthy woman. Federico is in rage and attempts to assault Metifio with a sledgehammer but they are separated by Baldassarre and Rosa. With things has calm, Rosa remains alone and laments the trials of motherhood (Esser madre è un inferno). L'Innocente awakes and tells his mother that she can go along to bed. He says he will keep watch over his brother. Rosa kisses him and caresses him as she never did before, but as she sends him back to bed.
Federico is half-delirious, repeating the last lines of the shepherd's story about the goat fighting with the wolf all night and falling dead at the break of dawn. He pictures how l'Arlesiana is being carried away on Metifio's horse. Rosa runs to him as Federico heads for the hayloft. He believes he hears l'Arlesiana cries. As his mother tries to stop him, he climbs up to the hayloft and jumps out of the window.