The party stops after several hours to eat and rest. John Faa asks Lyra to ask the alethiometer about how Bolvanger is protected. She says that it's just like Kaisa said, but the alethiometer is also telling her about a nearby village with a troublesome ghost. John Faa isn't interested in the ghost and asks more questions about the Tartars guarding Bolvanger. They all have wolf dæmons. This disturbs him. Lyra impatiently says that the ghost might be from one of the captured children, but when nobody listens, she approaches Iorek. He says that the village is too far away for Lyra, but it's not far for him. Lyra explains that the alethiometer is telling her she has to go there in order to figure out what the Gobblers are doing. Iorek says that if John Faa agrees, he can take Lyra there.
Now that the alethiometer has proven itself to Lyra on a number of occasions, she knows that it's silly to ignore what it's telling her to do. It's worth noting that in this situation, the alethiometer is also telling her about this "ghost" of its own volition; it's not something that Lyra asked about. This suggests that the alethiometer may have independent motives and a conscience of its own in some capacity. Though its instructions don't make sense right now, they will later—which speaks to the way in which destiny often doesn't make sense until after the fact.
Lyra asks John Faa if she and Iorek can go. She reminds him and Farder Coram about what happened when she couldn't interpret the chameleon, and says that this is the same thing. Lee Scoresby vouches for Iorek and finally, John Faa agrees. Lyra climbs onto Iorek's back and they lope away through the moonlight. Lyra wants to talk, but she thinks that Iorek is cold and strange. She thinks that she probably looks like a baby to him, which is an uncomfortable thought. After an hour, Iorek stops and tells Lyra to look up. Hundreds of witches are flying north. Iorek says that John Faa should know about this.
Realizing that she must look young to Iorek again shows that Lyra is beginning to come of age and be more aware of how she exists in the world. That Iorek takes note of the witches and says that they need to pass this information on to John Faa shows that he's not just in this to provide brute strength. He also wants to gain information to make it easier for his side to win, and he's going to throw his entire self into the endeavor.
Lyra and Iorek stop when they can see the village. Lyra says that there's something uncanny about the ghost or the child in the village, but she's not sure what they'll find. She quiets her fear by reminding herself that Lord Asriel is her father and that she commands a bear. In the middle of the village, a man steps out with a rifle. He and Iorek speak in a strange language, and Iorek translates that the man thinks he and Lyra are devils. She asks him to say that they're looking for a strange child, and the man immediately points and asks Iorek to take the scary child away. The man runs back inside and Iorek leads Lyra to the fish house.
The fear that the villager expresses indicates that whatever this ghost or child is, it's something that's inhuman to the point of being terrifying and undeniably different. That Lyra can calm herself down by reminding herself of her relationship to Lord Asriel shows again how much she idolizes him, something that ultimately keeps her from seeing that he's not someone she should trust.
Lyra is terrified, but she tugs the door open. Pan runs around as a white ermine, beside himself, and won't speak to Lyra or look inside the building. Lyra tries to be brave and enter, but Pan jumps at her and tells her to leave. An old man appears with a lantern and tells Iorek that he's seen children like this in the forest. Most die, and it's a mercy when they do. He gives Lyra the lantern and runs away. Lyra steps in and sees that the boy inside is clutching a fish to his heart like he'd clutch a dæmon. He has no dæmon; “intercision” means cutting a child's dæmon away.
Given the parameters of how the novel defines being human, this child isn't human: he has no soul. This tells Lyra that the people in charge of Bolvanger are experimenting with creating beings that are just as unhappy and unmoored as Iorek was before he got his armor back. The boy's appearance suggests that intercision is, in many ways, worse for humans than being without armor was for Iorek.