Lyra is marched through the bears' stone palace (more of a building, really). The place is filthy. The carvings on the walls are covered with bird poo. Inside the smell is even worse.
Lyra is taken to a cell where she learns from the alethiometer that Iorek is still a day's journey away. Thankfully, though, he's coming to rescue her.
In her cell Lyra meets a mad professor named Jotham Santelia.
Santelia says he was locked up because he knew too much about the bears – and Dust. He also knows Professor Trelawney, a scholar back at Oxford – his rival and obsession.
Lyra flatters the insane man and pretends to become his student – a clever move that will help her learn more about the bears.
Santelia tells Lyra that Iorek can never return because he's an outcast. Iofur would not fight a banished bear, not honorably at least.
Lyra mentions Lord Asriel and the mad man hushes her. You can't say Lord Asriel's name around Iofur.
We also learn that Mrs. Coulter has charmed Iofur. She's the one who got the bear king to keep Lord Asriel locked up. To play both sides, though, Iofur gave Lord Asriel all kinds of equipment to experiment with. The bear king is a little afraid of Lord Asriel.
Pretty soon Lyra remembers something she heard in the Retiring Room at Oxford: all Iofur really wants is to have his own daemon, and to be human. Hmm... looks like she might have a plan.
A guard finally comes to Lyra's cell and she demands to see Iofur.
Lyra is taken to Iofur's throne room, where he sits looking weirdly like a human. Everything around him is decorated in a human rather than a bearlike way.
On Iofur's knee is a creepy stuffed doll that looks kind of like Mrs. Coulter. Wow, this bear really wants his own daemon.
Lyra puts her plan into action. She convinces Iofur that she is Iorek's daemon and that she has run away from him.
She tells the bear king that if he fights Iorek honorably and wins, she will be his daemon forever.
To prove that she's really a daemon, Iofur has her consult the alethiometer and ask it two questions. The first is, who did he kill first? (The answer: his father.) The second is, what did Mrs. Coulter promise him (Christian baptism).
Lyra pulls it all off, and pretty soon she has the bear king eating out of her hand (metaphorically, of course). Lyra also learns from the alethiometer that Iorek is only an hour away, and that she should trust him.
Lyra is on a power trip, to be sure, but she chills out as the bears prepare for the fight.