The Story Line
Monastario has seen through Diego's attempts to disguise his fencing ability and plans his arrest and trial. He confronts Diego with the charge that the latter is secretly Zorro, an accusation the young don tries to laugh off. This time, however, Diego's charm fails to sway the commandante, who orders Diego held until he can be tried. The capitan's delight is cut short when he learns that the Viceroy, an agent of the King, will arrive that day for an inspection tour of the pueblo.
Desperate to hide the true conditions of his regime, Monastario orders all of the prisoners except Diego freed and that free wine be served at the tavern. The peasants are ordered to line the streets and welcome the Viceroy, who is surprised at this reception. He tells Monastario that he has heard rumors of unrest and cruelty, but he's delighted to see they are untrue. A smiling Monastario thanks the Viceroy for his confidence and promises another surprise - the arrest of Zorro.
That night, Diego is led into the tavern and denounced as the outlaw, a charge that astonishes the Viceroy. To Monastario's surprise, the Viceroy greets Diego as an old friend and is openly skeptical of the charge. Diego asks the Viceroy to indulge him in a small favor by asking the commandante to temporarily leave the room. When the protesting capitan returns, he sees a man dressed as Zorro whom he positively identifies as Diego, only to see the real Diego step out of hiding.
Disgraced before the Viceroy, Monastario attempts to prove that Diego is really Zorro by forcing him into a duel. Diego's childish efforts at defense convince the Viceroy that Monastario is wrong, and he orders the fight stopped. Monastario's downfall is assured when Zorro suddenly rides into the plaza seemingly proving that Diego is innocent of the crimes Monastario has charged him with. The Viceroy orders Monastario and his henchman, Piña, arrested and places Garcia temporarily in charge.
Cleared of the charges against him, Diego joins Bernardo for a celebration and a "thank you", for it was his loyal servant and friend who had dressed as Zorro and rode into the plaza.