Harry comes to lying facedown on the ground. Death Eaters quietly whisper and Harry opens his eyes a fraction. He sees Voldemort getting up and he wonders if they both collapsed and were unconscious. Voldemort sends Narcissa to check if Harry is dead. She feels his heart and quietly whispers to ask if Draco is alive. Harry confirms that he is, and Narcissa pronounces Harry dead. Harry realizes that she doesn't care if Voldemort wins; she just wants her family safe. Death Eaters celebrate and Voldemort performs the Cruciatus Curse on Harry, but it doesn't hurt. Voldemort tells Hagrid to carry Harry back through the forest and Hagrid sobs as they walk. Harry hears Hagrid insult the centaurs for not fighting.
The fact that Voldemort also fell to the ground confirms that his curse actually killed a part of his soul, not Harry. Narcissa's desire to get to Draco shows Harry that, at this point, he has allies in all sorts of places if he's willing to trade information for help. This makes Narcissa a more complex character, as well, as it shows that she's driven mostly by love for her family and isn't actually sold on Voldemort's vision for the world.
At the edge of the forest, the procession stops. Voldemort magnifies his voice and announces that Harry is dead. He asks everyone to come outside to and then leads Hagrid up toward the castle. Harry peeks and sees that Nagini is around Voldemort's shoulders. At the doors of Hogwarts, McGonagall screams in grief and Ron, Hermione, and Ginny join in. Voldemort silences them. Ron shouts that Harry beat Voldemort and everyone starts yelling, but Voldemort silences them and says that Harry died trying to sneak away. Someone runs at Voldemort, but Voldemort Disarms him. Bellatrix laughs: it's Neville. Neville refuses to join the Death Eaters.
What Voldemort says here shows that he's trying to warp the story and turn Harry into a coward, not a martyr. However, this is hard to do when Harry's community is so dedicated to him and when they believe so strongly in what Harry fought for. This shows that Voldemort once again underestimated the power of love and the power of community, as it seems as though it's going to be a struggle to subdue this emotional crowd.
Harry watches as Voldemort Summons the Sorting Hat. Voldemort declares that Slytherin will be the only House going forward, curses Neville to be still, puts the hat on Neville's head, and lights it on fire. Suddenly, Grawp starts running at the giants, yelling for Hagrid; Harry hears centaurs running toward them; and Neville breaks the curse, pulls the sword of Gryffindor out of the hat, and kills Nagini. Harry rolls over, pulls on the Cloak, and casts a shield between Voldemort and Neville. The centaurs scatter the Death Eaters while thestrals dive at the giants, and everyone is forced into the castle. Harry continues to cast shields and protect his friends as even more people arrive and join the fray. The house-elves, led by Kreacher, swarm in and attack Death Eaters with knives.
Declaring that there won't be any more Sorting at Hogwarts shows that Voldemort understands that this is a battle about the fate of the school. That Neville is able to pull the sword out of the Sorting Hat shows that the hat itself is still dedicated to the vision of the school put forth by Dumbledore, in which sorting might have its faults, but it ultimately provides richness, nuance, and perks—like the sword—that makes Hogwarts a better place. The involvement of Kreacher and the centaurs shows that Harry's loyalty to these non-human creatures is now paying off.
Harry edges into the Great Hall and watches the battles, trying to get closer to Voldemort. He sees Bellatrix shoot a Killing Curse and narrowly miss Ginny, and Mrs. Weasley furiously begins to duel Bellatrix. Harry is unsure of what to do, but Mrs. Weasley's curse hits Bellatrix in the chest. Bellatrix falls backwards, dead. Harry sees Voldemort blast McGonagall, Slughorn, and Kingsley back. Harry casts a shield again and finally reveals himself. He instructs everyone to let him finish Voldemort alone, and he and Voldemort taunt each other. Voldemort insists that Harry is still alive because of chance, but Harry says that he sacrificed himself for his friends and now Voldemort can't hurt them.
Given that Voldemort seems to be evenly matched against the professors and Order members, Harry has a point—Voldemort clearly isn't the most powerful person in the room anymore. He has also lost all of his community, now that the Malfoys have basically defected and now that Bellatrix is dead. With this, the battle shifts to be Voldemort against everyone else, and given the way that the series has consistently touted the power of community, it seems as though Voldemort is in a tough spot.
Voldemort looks momentarily concerned and then sneeringly asks if Harry is going to win because of love or because he has better magic. Harry says he has both, defends Dumbledore, and Voldemort insists that he orchestrated Dumbledore's death. Harry calmly explains that Dumbledore orchestrated his own death, that Snape served Dumbledore, and that Snape loved Lily. Voldemort insists that Dumbledore just wanted to keep the Elder Wand from him and pass it on to Snape, but he insists that he mastered the wand. Harry asks Voldemort to try to feel remorse, which seems to shock Voldemort more than anything else. Harry says that because Dumbledore planned his death, the wand's power would've died with him. Just holding the wand doesn't make him its master. Draco won the wand from Dumbledore, and Harry won the wand from Draco.
Giving Voldemort the chance to repent is, in this moment, one of the kindest things that Harry can do—and by choosing to give Voldemort this opportunity, Harry throws Voldemort's evil into even sharper relief. Voldemort isn't giving people the chance to repent, while Harry is. Harry also shows in this moment that he understands that Dumbledore was right, and knowledge is power. Because Harry knows who the true master of the Elder Wand is, he's able to trust that he has the upper hand and that Voldemort won't come out of this alive.
As the sun emerges over the horizon, Voldemort shoots a Killing Curse at Harry and Harry responds with a Disarming spell. Gold flames erupt between them, the Elder Wand goes flying, and Harry catches it as Voldemort dies from his own curse. People begin to scream and celebrate. They all want to touch Harry. They move Voldemort's body away and everyone sits at the House tables, though not according to their Houses. Harry finds himself next to Luna, who suggests he get some peace and quiet. She creates a diversion as Harry slips on his cloak. He decides to not talk to Ginny now and sees the Malfoy family huddled together. Harry finds Ron and Hermione and leads them out. He tells them what he saw in the Pensieve and what happened in the forest.
Because Harry is secure in the truth of what he knows, he understands that Voldemort doesn't stand a chance: brute strength, in this case, means nothing when put up against knowledge. Everyone sitting at different House tables symbolizes that, at this point in history, Hogwarts now truly stands for diversity and community more than ever before. Everyone, even some Slytherins (like Snape and Slughorn) came out to fight for the school and for what they know was right. Now, Hogwarts can move forward and promote diversity and tolerance.
They reach the headmaster's office and the gargoyle lets them up. The headmasters' portraits applaud, and Dumbledore's crying portrait beams at Harry. Harry tells Dumbledore he dropped the Resurrection Stone in the forest and doesn't want to go look for it. Dumbledore agrees that this is a good plan. Harry holds up the Elder Wand and says he doesn't want it. He pulls out his original wand and repairs it with the Elder Wand. Harry says he's going to put the Elder Wand back and confirms that, if he dies a natural death, the power of the wand will die too.
By choosing to forgo the Resurrection Stone and the Elder Wand, Harry shows that he's taken what he's learned to heart: it's better to use his Cloak to protect others and to pass on his knowledge to future generations than it is to remain fixated on power and extracting impossible answers from the dead.