First, the Sparknotes summary:
Telemachus leaves Odysseus at Eumaeus’s hut and heads to his palace, where he receives a tearful welcome from Penelope and the nurse Eurycleia. In the palace hall he meets Theoclymenus and Piraeus. He tells Piraeus not to bring his gifts from Menelaus to the palace; he fears that the suitors will steal them if they kill him. When he sits down to eat with Penelope, Telemachus tells her what little news he received of Odysseus in Pylos and Sparta, but he doesn’t reveal that he has seen Odysseus with his own eyes in Eumaeus’s hut. Theoclymenus then speaks up and swears that Odysseus is in Ithaca at this very moment.
Meanwhile, Eumaeus and Odysseus set out toward town in Telemachus’s footsteps. On the way they meet Melanthius, a base subordinate of the suitors, who heaps scorn on Eumaeus and kicks his beggar companion. Odysseus receives a similar welcome at the palace. The suitors give him food with great reluctance, and Antinous goes out of his way to insult him. When Odysseus answers insult with insult, Antinous gives him a blow with a stool that disgusts even the other suitors. Report of this cruelty reaches Penelope, who asks to have the beggar brought to her so that she can question him about Odysseus. Odysseus, however, doesn’t want the suitors to see him heading toward the queen’s room. Eumaeus announces that he must return to his hut and hogs, leaving Odysseus alone with Telemachus and the suitors.
Odysseus comes in for some rough treatment here, first from the goatherd Melanthios (who is the bad counterpart of the good swineherd Eumaios) and then from the suitors. In particular, Alkinoos verbally and physically abuses him, throwing a footstool and him threatening him with worse. As we have consistently seen, the treatment of strangers and guests is a reliable index of civilised values in the Odyssey, even though Odysseus is at this point a beggar receiving charity rather than an honoured house guest. Even the other suitors realise that Alkinoos has gone too far, and remind him that Odysseus may be a god in disguise - the motif of a stranger being a god in disguise is found in a number of different cultures.
Odysseus claims to be a blue-blood down on his luck, another example of Homer indicating that social status is a matter of chance. The porous nature of class barriers is also indicated by the fact that Telemakhos again refers to Eumaios as "atta" ("daddy").
This Book contains the well-known scene in which Odysseus' decrepit old dog Argos dies immediately after being reunited with his master.