While the children are touring the chocolate factory, Mr. Wonka opens what is called the the Chocolate door, warning the children not to get too excited at what they see. On the other side of the door, in the middle of the factory, the children and their parents/guardians step into a wonderful valley. The trees and the plants in it, including the beautiful flowers, are unusual in being edible, while the water in the river and waterfall is made of chocolate. The force of the waterfall churns the chocolate, making it light and fluffy. Mr. Wonka encourages the children to taste an edible a blade of the valley's delicious grass, which he says is called swudge.

The children also notice the small people called Oompa-Loompas working in the valley. These once oppressed people live and work in the chocolate factory in exchange for as many cocoa beans as they want, which they value above all other commodities.

The children exhibit their character flaws in the valley. For example, Veronica Salt demands her father get her an Oompa-Loompa. Augustus Gloop shows his greed by taking a whole handful of the grass instead of just one blade. Augustus's greed also causes him to start lapping up the chocolate water like a dog, despite Mr. Wonka telling him not to. He falls into the river and gets stuck in a glass tube. Charlie, however, behaves well.