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Over their midday meal, Twinkle's father announces that a woodchuck is eating his red clover; Twinkle's mother suggests he set a trap for the animal, and he does. After her chores are done, Twinkle goes out to the woodchuck's hole; she lies in the clover, waiting to see what will happen. She dozes off for a moment; and when she wakes again, the scene around her is changing. The woodchuck's hole is transforming into a stately house, with a polished front door and a white marble stoop, and green benches on either side. The trap remains before the door, though it seems much smaller now.
A uniformed jack-rabbit comes to deliver a telegram; the door is opened by a large woodchuck, who wears a white satin waistcoat, fancy knee-breeches, silver-buckled shoes, and a swallow-tail coat. He carries a gold-headed cane, sports a silk top hat on his head, and wears eyeglasses too. The telegram comes from friends, warning him of the trap before his door. Mr. Woodchuck tosses the trap aside, then sees Twinkle; he grabs her by her arm, and draws her into his house.
The place is handsomely furnished. The two go through to the garden, which is beautifully laid out, with colorful plants and a fountain within a high stone wall. Mr. Woodchuck is surprisingly good-humored, and uncertain as to what he should do with Twinkle. The two discuss the possibility that Twinkle is dreaming — a theme that runs through the tale. The Woodchuck recognizes that Twinkle is personally innocent, but he suspects that some punishment is still is order, for all the cruelty that humans inflict upon animals.
Mr. Woodchuck introduces his family. Mrs. Woodchuck is showily dressed, and so fat she has no neck; she dislikes Twinkle, and treats her rudely. Her children are dressed and furnished like humans: the oldest son wears a Tam o' Shanter cap and knickerbockers, and rolls a hoop; one little girl woodchuck wheels a "baby-cab" with a stuffed woodchuck baby doll within.
Still perplexed about Twinkle, Mr. Woodchuck takes her to Judge Stonyheart, a woodchuck jurist. He decides to put her in a trap, the same kind of trap used by her father. Twinkle is quite frightened by this; Mr. Woodchuck, eying the girl, observes, "I believe she's going to wake up!" — and she does.
At home, Twinkle prevails on her father to lay no more traps, and to accept the small predations on his crops that the animals make. He kisses her forehead, and agrees.
Upon his first appearance, Mr. Woodchuck, in his vest and other accoutrements, reminds the reader of the White Rabbit in Lewis Carroll's Alice's Adventures in Wonderland. Yet there were plenty of other precedents of animals in human clothes by the time Baum wrote this tale; the Uncle Remus stories were well known, and Beatrix Potter had started publishing her animal stories with The Tale of Peter Rabbit in 1902.
Baum tells a similar story, of trapped animals released through a child's compassion, in "Juggerjook."