Pilar Ternera’s son is brought to the Buendía house when he is just two weeks old and Úrsula welcomes him in at José Arcadio Buendía’s urging, but they decide he will never know his true identity. They call him Arcadio. A Guajiro Indian woman named Visitacíon who came to town to escape a plague of insomnia in her tribe. Úrsula builds a business making candy animals and the town becomes more active with the new inhabitants Úrsula has introduced. José Arcadio Buendía sets down his alchemical work to return to the development of the town. The gypsies return, but José Arcadio (I) is not in their company. The birds that José Arcadio Buendía had once caged are traded for musical cuckoo clocks.
Úrsula taking in Arcadio, but committing to keeping his identity a secret, is the first of many instances in which children are not told their true parentage, providing the opportunity for all sorts of unknowing incest. Úrsula, having taken on the responsibility to support her family financially, sees the idea of insomnia as a boon that would allow her to work more without rest, but Visitacíon warns against the amnesia that comes with the lack of sleep. This recalls the machine the gypsies introduced in which people would forget bad memories but lose their sense of time, as well. The live birds being traded for mechanical ones indicates the technological developments accelerating in the presence of new inhabitants immigrating into the town.
Aureliano Buendía stays alone in the lab teaching himself the art of silver-smithing. He tells Úrsula that he can sense someone is coming though he doesn’t know who. That Sunday, an eleven-year-old orphan named Rebeca appears with a letter for José Arcadio Buendía and a bag of her parents’ bones. The child is a second-cousin of Úrsula’s, but neither she nor José Arcadio Buendía remember any of the names mentioned in the letter. The Buendías adopt her, with little other option. The Indians discover that Rebeca only likes to eat dirt and the whitewash from the walls. They force her to eat bitter rhubarb and beat her until eventually she eats and begins to take part in the family.
Aureliano continues to have premonitions, predicting the arrival of his soon-to-be adopted sister, Rebeca. Rebeca arrives with a literal representation of her past and the ghosts that haunt her in the form of her parents’ bones. The Buendías take her in despite not knowing who she is, and they try to train her to eat real food rather than the earth she prefers because she suffers from pica, perhaps a sign that she lacked sufficient food in the place she came from.
Visitacíon recognizes in Rebeca symptoms of the insomnia plague she had tried to outrun. She explains to the others that the danger of not sleeping is a loss of memory that reduces the people who suffer from it to a state of “idiocy that had no past.” José Arcadio Buendía believes she is just being superstitious, but Ursula takes precautions to protect the other children. Soon enough, José Arcadio Buendía, Úrsula and Aureliano Buendía all find themselves unable to sleep for several days. They dream while awake. Úrsula continues to sell her candies, and they infect the whole town with the insomnia. Visitors to Macondo are forced to ring a bell to indicate their health so that they might not be infected.
Visitacíon, one of the Guajiro servants, believes that Rebeca might be from her same village, a recognition that suggests Rebeca might be trying to outrun the same plague of insomnia that Visitacíon and her brother fled. The insomnia’s dreaminess while awake that ends up infesting the town of Macondo adds to the confusion about what is real and what is imagined. Whereas, historically, victims of the plague would need to ring a bell to indicate their presence, so that healthy people would know to steer clear of them, the situation is reversed here, because the assumption is that most people are infected rather than healthy.
Aureliano Buendía begins to label objects with their names so that they wouldn’t be forgotten. They attempt to pin down reality with language, but recognize it is a losing battle. Pilar Ternera begins to read both the past and future in her cards now, popularizing an imaginary reality that is sometimes more comforting than actual reality. José Arcadio Buendía attempts to invent a memory machine when a man arrives to the Buendía house, aware that he has been forgotten. He gives José Arcadio Buendía a drink that revives his memory and José Arcadio Buendía realizes the man is Melquíades, back from the dead because he could not bear the solitude.
The forgetting becomes so exaggerated that people even forget the words for everyday objects. The labeling of objects works to a certain extent, but there are all sorts of words for things that can’t be labeled that are lost or reimagined. Because the people of Macondo no longer remember their history, Pilar begins to make up both the past and future by looking at her cards, again emphasizing the arbitrary nature of history. José Arcadio Buendía tries to create a version of a memory machine, this time one that will bring back memories, but only the arrival of the resurrected Melquíades with a special elixir can restore people’s abilities to remember the past.
Melquíades has brought with him the technology to produce daguerreotypes. He takes a photo of José Arcadio Buendía and of the children. Aureliano Buendía has become a master silversmith, but the town begins to worry that he has not known a woman yet. A two-hundred-year-old troubadour visits town, singing the stories of the surrounding communities, and Úrsula learns that her mother has died. Listening to the old man’s song one night at a store, Aureliano is ushered into a back room and confronted with a mixed-race girl who has been visited by sixty-three paying customers already that night. Aureliano is reluctant and learns the girl’s story that her body is being sold to make up for the expense of the childhood home she accidentally burned down. Moved by her story, Aureliano decides to marry her, but when he returns to the store, she has left town.
The new technology introduced by Melquíades is a primitive form of photography. He uses this machine to document the Buendía family. The only way for Úrsula to learn of the death of her mother is via the oral storytelling of the troubadour who comes through town, an example of the way the people of Macondo still lack access to technology like a mail service. Aureliano’s empathy for the young woman forced into sexual slavery by her own grandmother causes him to seek to release her from her servitude, but he doesn’t act with enough haste and loses the chance to help free her of her obligations. She is the first of many prostitutes to appear in Macondo.
José Arcadio Buendía resolves to use the daguerreotype laboratory to take a picture of God to prove He exists. Melquíades believes he sees the future of Macondo in his interpretation of Nostradamus, but José Arcadio Buendía denies that Macondo could exist without a Buendía. Úrsula expands her business to include breads, puddings and other baked goods. She sees Amaranta and Rebeca in the courtyard and realizes they have become young women. She realizes that soon her children will begin to marry and that, if she wants to keep them nearby, she will need to enlarge the house, and sets to work doing so.
Once again José Arcadio Buendía attempts to use Melquíades’s invention for a magical purpose, trying to prove what he believes in, rather than having blind faith. José Arcadio Buendía’s belief that Macondo could not exist without a resident Buendía proves accurate. Úrsula’s business and her recognition that she will need to expand her house in order to keep her children close show that she is the glue of this family, acting with reason, rather than fantasy.
An order arrives declaring that the house must be painted blue instead of white. The letter is from an authority sent by the government, Don Apolinar Moscote. José Arcadio Buendía goes to confront the supposed magistrate. He tells Don Apolinar Moscote that there are no judges needed in the town because there are no crimes to be judged, but that he may stay as an ordinary citizen. Don Apolinar Moscote warns that he is armed and José Arcadio Buendía picks him up by the lapels and carries him through town to the road out of town. Two weeks later, Don Apolinar Moscote returns with soldiers and his family.
The introduction of outside governance into Macondo provides a rude awakening for the residents who have, up until now, been allowed to rule over themselves with very little law or order needed. Though José Arcadio Buendía tries to prevent this intrusion from happening, the magistrate returns with soldiers, insistent on taking Macondo by force if necessary. The nature of the first law, deciding what color the houses could be painted, establishes the arbitrary nature of laws—they’re not necessary in Macondo for peaceful coexistence.
José Arcadio Buendía, not wanting to make trouble for Don Apolinar Moscote in front of his family, goes with Aureliano Buendía to visit him in his office. Two of his daughters are there with him, one being a pretty nine-year-old named Remedios. José Arcadio Buendía tells him that he can stay under two conditions: that everyone can paint their house the color of their choosing and that the soldiers leave at once. Don Apolinar Moscote agrees to the conditions, but José Arcadio Buendía states that, despite his acquiescence, they are still enemies. The soldiers leave and José Arcadio Buendía finds a house of the Moscote family. Aureliano can’t stop thinking about little Remedios.
José Arcadio Buendía either shows great propriety in his commitment to not embarrassing Don Apolinar Moscote in front of his family, or he shows that he is not strong enough to fight back against the magistrate’s presence in the town. His conditions for the magistrate remaining in town show him battling only the present threats posed by the newcomer, rather than the long-term changes that might be effected by his presence, evidencing a lack of foresight.