The chapter opens in a dilapidated safehouse on the Thames river, in a poor section of London. Toby Crackit is hiding out there with Chitling and another, old thief named Kags, trying to avoid detection by the police, who are after all of Fagin's group, after having been alerted to them by Brownlow. Chitling tells Crackit what he knows: that Fagin was taken just that day, that the management of the Cripples have also been arrested (along with Noah and Charlotte), and that Bates, still free for now, is on his way to the safehouse.
The last of the novel's criminal safehouses, and, of course, this one is none too safe for anyone inside. We begin learning, very quickly, what has happened to the other characters—Fagin, like other people of some importance in the novel, is captured "off-stage" by authorities, although the reader does get to see him one more time before he is taken off to be hanged.
Sikes' dog comes bounding into the safehouse, followed some hours later by Sikes, who now resembles a "ghost." Bates, who has arrived at the safehouse in the interim (between the dog and Sikes), will not speak to Sikes, and finds him abhorrent. Sikes thought his friends would support him, but in general the robbers are now simply afraid of him, nor do they wish to associate with him.
This marks a turning-point in Bates' character. Bates believed that all the activities of the gang were funny, but once Nancy has died, he realizes that the group's "fun and games" have real consequences; at this point, he turns against Sikes. Bates is the only criminal in the novel who escapes criminality.
Bates attempts to grapple with Sikes and turn him over to the authorities himself. He cannot subdue Sikes, but Bates yells so much that a crowd begins assembling outside the house, hearing that perhaps the murderer is inside. Sikes refuses to give in, however, and wresting himself free from Bates and the others, he takes a rope and goes up onto the roof of the house—he believes that the tide of the Thames is high enough that he can swing out from the house over the river and escape that way. The crowd outside is now over a hundred people.
Crowds tends to assemble quickly in Dickens—as when Oliver is captured "stealing" from Brownlow, and a crowd quickly forms in the street outside. Here, Dickens seems to be playing on the incredibly packed urban density of London, which would have allowed information to travel quite fast from tenement to tenement building.
In an effort to escape, Sikes ties one end of the rope around a chimney, and is beginning to loop another around the middle of his body, so that he can attempt his escape by lowering himself to the river. But just as he is looping the rope over his neck, he turns and believes he sees "the eyes" of Nancy, which have been following him these many days and preventing him from sleeping. He stumbles and falls; the rope, lodged around his neck, hangs him; and Sikes accidentally kills himself above the crowd. His dog runs and jumps after him, and falls to its death.
Both Sikes and his dog die gruesome deaths—the most gruesome in the novel. Although Sikes is not hanged by the authorities, he is hanged by the only person he has ever cared about—himself. Though in seeing the eyes of Nancy before he dies gives her a sort of revenge and implies that it is guilt that kills him, or even that his death is a kind of half-suicide, as if his subconscious kills him. Sikes's dog dies out of loyalty to Sikes, just as Nancy did.