What is the curse on the Lady of Shalott?
In the first stanza of Part II, the narrator tells us that the Lady of Shalott has no time "to sport or play" because she must continue to weave and weave at her loom, and she is not permitted to stop her weaving. The narrator says,
A curse is on her, if she stay
Her weaving, either night or day,
To look down to Camelot.
She knows not what the curse may be;
Therefore she weaveth steadily . . .
In other words, the curse will take effect if the Lady stops weaving, and so she cannot ever stop, during either day or night, for any reason—even for something as simple as glancing out her window to look at Camelot below. The Lady does not actually know what the curse is, or what exactly will happen to her if she stops, and so she never stops.
Because she cannot stop to look out her window, she keeps a mirror that reflects what is happening outside; this way, she can look at her mirror—without ceasing her work—to see what's going on. However, when she catches sight of Sir Lancelot, she runs to the window without thinking. Suddenly, her loom flies apart and her mirror cracks, and the Lady knows that the "'curse is . . . upon [her].'"
The details of the curse are not disclosed in the poem, although sometimes the assumption is made that she's been cursed by a rival. As a result of the curse, the Lady is allowed to see the outside world only as a reflection in a mirror. One day she catches sight of the handsome knight Lancelot and cannot resist looking at him directly, thus bringing the curse upon herself. Her punishment is to drift in a boat down to Camelot 'singing her last song'; she dies before reaching her destination.