Othello questions Emilia, who insists that nothing has happened between Desdemona and Cassio. He orders her to go get Desdemona. Othello assumes that Emilia is helping Desdemona in her infidelity.
Despite naively playing into Iago's hands earlier by giving him the handkerchief, Emilia shows her earnest loyalty to Desdemona.
Emilia returns with Desdemona. Othello sends Emilia outside to guard the door. Othello than says he could have handled any affliction but infidelity. Desdemona denies being unfaithful and asserts both her love and loyalty to Othello. But her denials only make Othello more angry—he calls her a whore, and, after giving Emilia money for guarding the door, storms out.
Now that Othello suspects that Desdemona's virtue is just a cover for whore-like behavior, her denials of his accusation just makes him more certain of its truth. Jealousy feeds on itself. By paying Emilia, Othello is implying that Desdemona is a whore whose time costs money.
Desdemona asks Emilia to fetch Iago, whom Desdemona then questions about Othello's behavior. Emilia thinks that it must be the doing of some "eternal villain" who is looking "to get some office" (4.2.135-136). Iago scoffs at this, and says that Othello is just upset by affairs of state. Trumpets sound, and Emilia and Desdemona exit to go to supper.
Here Iago shows that he is both willing and able to manipulate everyone, including his own wife, to the end. Emilia herself exhibits some—but not enough—perceptiveness about the entire situation.
Roderigo enters, angry that he still does not have Desdemona despite all the jewels he's given to Iago to pass on to her. He says he is ready to give up his effort and ask her to return his jewels.
For the first time, Roderigo asserts a free will, and wants to do something that would not benefit Iago.
Iago responds that he's been working diligently on Roderigo's behalf and can promise that Rodrigo will have Desdemona by the following night. He then tells Roderigo about Cassio being promoted by the Duke to take Othello's place as defender of Cyprus. But he adds a lie: that Othello, rather than returning to Venice, is being sent to Mauritania along with Desdemona. Iago persuades Roderigo that the only way to stop Desdemona from slipping forever beyond his reach is to kill Cassio, which will keep Othello in Cyprus.
But Iago manages to maintain control of the situation by once again playing on Roderigo's jealous desire for Desdemona. Once he has convinced Roderigo to stay, he then weaves him even more fully into his plots.