This whole James Vane incident seems to have shaken Dorian significantly. Back in London, he informs Lord Henry that he's going to become a good person again.
Henry doesn't believe it, nor does he think Dorian should change at all. In his view, his friend is perfect. For about the thousandth time, we think about how warped Lord Henry is.
Apparently, the day before, Dorian was staying out in the countryside by himself, and Henry comments that it's a lot easier to be good out there, since there's nothing to do.
Dorian continues, saying that he's altered (presumably for the better).
Lord Henry demands to know what Dorian's done that's so great.
Dorian tells Henry about a young girl that he met and fell in love with in the countryside. She reminded him of Sibyl Vane, and she totally fell for him. However, instead of corrupting her and destroying her life, he decided to let her go—he leaves her in her innocent state.
Dorian thinks this good deed is enough to set him on the path to righteousness, despite Henry's doubts. Lord Henry continues to mock Dorian's fantasies.
Dorian abruptly changes the subject, and asks Henry what's going on around town. Apparently, the gossip around their club is all about Basil—people are still discussing his disappearance. We also hear in passing that Alan Campbell committed suicide (no doubt because of what Dorian did to him).
Dorian plays it cool, and asks Henry what he thinks happened to Basil; Lord Henry's basically like, "Screw Basil! Listen to me talk about my life."
But Dorian doesn't want to let it go. He asks Henry if he's ever wondered if Basil was murdered—or, for that matter, if anyone else thinks that. Henry's just not that concerned; besides, he doesn't think Basil was interesting enough to get himself murdered.
Dorian asks an interesting hypothetical question: what would Henry think if he said that he had killed Basil?
Henry basically laughs this off, too, saying that crime is for the lower classes. He honestly just doesn't care, and even jokes that Basil probably drowned in the river Seine. Since Basil's paintings haven't been that great lately, Henry doesn't think there's anything to be sad about.
Henry brings up the portrait, which he identifies as one of Basil's great works. Apparently Dorian told him that it was either lost or stolen.
They discuss the painting a bit more, and Dorian confesses that he never liked it (we know why).
Lord Henry changes the topic slightly to souls—what might it be like to sell one's soul? Little does he know that he's talking to the one person who knows…
Dorian tells Henry that that he's sure that everyone has a soul, for better or worse.
Languidly, Henry asks Dorian to play some Chopin on the piano. As Dorian plays, Henry muses at length about Dorian's youth and beauty, and his own lost youth. He tells Dorian that he's led an amazing, full life, and mistakenly praises him for still being the same. Dorian corrects him, saying that he's not the same, but Henry doesn't believe it. He thinks that Dorian is perfect.
Henry goes on, saying that Dorian has always been loved by the world, even when it denounced him; he says that Dorian is the ideal of their time, and that, though he's never created anything, his whole life has been art.
Dorian stops playing and tells Henry again that things are going to be different from now on. He resists Henry's praise of him.
After insisting that he's going to change, Dorian reminds Lord Henry that the older man poisoned him with the yellow book, all those years ago. Henry doesn't buy it, saying that art doesn't influence real life.
Dorian says his goodbyes and extricates himself from Henry, after wearily promising to see him the next day.