The Geats and Danes feast in Heorot. But Unferth, the son of Ecglaf, jealously taunts Beowulf. According to Unferth, as young men Beowulf and another Geat named Breca had a swimming competition, and Breca won. Unferth says he now expects Beowulf to fail to fulfill his boasts regarding Grendel.
The feast cements the loyalty between Geats and Danes. But Unferth, seemingly jealous and wishing to increase his own fame, tries to shame Beowulf.
Beowulf replies that Unferth is drunk, and tells his version of the story: as youths, he and Breca did have a contest in the sea, but he, Beowulf, won. For five nights, the two youths swam in their armor holding up their swords. But eventually the tide separated them. Beowulf was pulled to the bottom of the ocean by a sea monster, that he then fought and killed. Beowulf comments: "fate often saves an undoomed man when his courage is firm."
Whether Beowulf's amazing tale is true or not, his prowess as a boaster can't be questioned. Beowulf's comment about the relationship between courage and fate implies that if a man does not fear death he can win fate's favor and therefore is actually less likely to die.
Beowulf adds that he killed nine sea-monsters in all. He says has not heard that Unferth has done so much, though he has heard that Unferth killed his own brother. Beowulf says that Grendel would never have overcome Heorot if Unferth were as brave as he claims to be.
Killing a brother is perhaps the worst crime one can commit (and the crime that made Grendel's ancestor Cain an outcast). Unferth's lack of response implies the charge is true.
Hrothgar and the Danes are cheered by Beowulf's resolve and daring. Wealhtheow, Hrothgar's queen, offers Beowulf a goblet of mead, then offers it to the other warriors in turn.
Beowulf's boasting endears him to the Danes. Wealhtheow acts as a good queen, creating fellowship by sharing the mead-cup.
At nightfall, the Danes leave the hall to Beowulf and his men. Beowulf again promises to fight Grendel with his bare hands. He says, "may God, the holy Lord, assign glory to the side that seems best to him," and lies down to wait.
Beowulf reaffirms his courage and lack of fear of death. He also prays to God, but seems to see God and fate as the same thing.