The Hobbit Chapter 12
The dwarves debate over the next course of action, until Thorin speaks eloquently suggesting that since Bilbo is the hired thief, he should proceed forward first. Bilbo is very upset at this, and tries to tell them that he has already earned his reward by saving them twice. He gives in, and tells them that he will go in and take a look. None will accompany him any further than a few feet into the tunnel. They tell him that they really do intend to pay him well. The narrator interjects that dwarves really aren't the heroic type. The stars begin to come out as Bilbo enters the smooth tunnel. He slips on his ring, and is careful not to make even the slightest sound as he loosens his dagger and trembles in fear. He tells himself he is done for and wishes he could wake up and find out that all of this is just a dream. He continues down the tunnel toward a growing red light. The heat begins to increase, and he hears a sound that he soon identifies as the snoring of a very large creature. Bilbo halts and fights to make himself continue. He steps into the giant hall and sees the dragon Smaug sprawled over a huge pile of gold and treasure. His wings are folded like a gigantic bat. Coats of arms line the walls. Bilbo staggers and loses his breath, enchanted by the beast and its treasure. He gazes at the mound for a while, then rushes towards it, and grabs the first thing he sees: a two-handled cup. He runs back down the tunnel and takes off his ring. Balin sees him and is happy that he came back. The others are delighted as they pass around the cup. As they do this, they hear the mountain rumble.
Smaug knows every ounce of his treasure, even though it is so large. He was woken from his nap by the feeling that something was stolen. In a half-conscious sort of way, he had heard pounding from a little hole near the floor. Now he has been feeling a draft. All he can think of is the word 'thief'. He tries to fit his head into the tunnel but cannot. He flies out through the front gate and around to the western side, to find the thief.
The dwarves would have been killed had Bilbo not screamed and pushed them into the tunnel. Bifur remembers that Bofur and Bombur are down near the ponies. He refuses to abandon them. Thorin calls for ropes and they haul the two dwarves up. Just as the dragon appears, they pull into the tunnel.
"Smaug came hurtling in from the North, licking the mountain-sides with flame, beating his great wings with a noise like a roaring wind. His hot breath shrivelled the grass before the door, and drove in through the crack they had left and scorched them as they hid. Flickering fires leaped up and black rock-shadows danced. The darkness fell as he passed again." Chapter 12, pg. 217
They hear the ponies break their ropes. Smaug pursues and kills the pack-animals. When dawn comes, the dragon returns to his mound of gold, vowing never to forget the thief. He reasons that the thief must have come from Esgaroth.
At dawn, the dwarves are still terrified. They cannot leave and can think of no way of slaying the dragon. They begin to grumble at Bilbo again. Bilbo gets angry and tells them that he is only supposed to steal things. He yells and they apologize. They ask him again if he knows what they should do. He tells them that they should wait in the tunnel and that he will creep back to the dragon's lair later to see if the beast has a weak spot. They accept his offer. At noon, he goes into the tunnel and moves silently after putting on his ring. He sees that the dragon is sleeping and thinks that he is safe.
When Bilbo steps into the room, the dragon's eyes snap open. Dragons know how to sleep lightly when they are expecting company. Smaug tells the thief to come out because he cannot see Bilbo. Bilbo speaks and tells him that he only came to look on the impressive size of such a great dragon. Bilbo remembers, from tales he heard from his father, that dragons love flattery. He praises the beast, and Smaug tells him he has nice manners for a thief. He asks Bilbo who he is and where he is from. Bilbo starts to speak in riddles, because he thinks it will either entertain or confuse the dragon. He calls himself things like spider-slayer and barrel-rider. Smaug becomes interested in this game, although he doesn't understand everything that the thief is referring to. He thinks that Bilbo must be from Esgaroth because they use barrels there. Smaug warns him not to have too much to do with dwarves, and tells him that he can smell them in the tunnel. The dragon laughs and tells Bilbo that the dwarves are making him do all the hard work. Bilbo gets uncomfortable and tries to claim that they came not only for the gold, but to get revenge. Smaug laughs at this. He tells Bilbo that he knows there are fourteen of them. He asks the hobbit how they plan to carry enough treasure away with them to make the journey worth it. Bilbo begins to doubt himself, because the dwarves have said nothing of these things. Smaug laughs and says that there will be no revenge, because everyone he took property from is dead. He adds "'My armor is like tenfold shields, my teeth are swords, my claws spears, the shock of my tail a thunderbolt, my wings a hurricane and my breath death.'" Chapter 12, pg. 224. Bilbo tells him that he heard that dragons have a soft underbelly. Smaug laughs at this and rolls over so that Bilbo can see his scale-covered stomach. Bilbo praises his strength as he sees a bare spot over the dragon's left breast. Bilbo wants to leave, so he bids the dragon a farewell and then starts to run. The dragon spouts flame down the tunnel and singes the hobbit. When his head does not fit in the hole, he thunders.
A scorched hobbit collapses on the doorstep and the dwarves make him relay the story. The old thrush is still around them, making noise. Bilbo curses it and Thorin tells him that thrushes used to be trained by the men of Dale to pass messages. Only the men of Dale could understand their language. Bilbo tells Thorin that he knows Smaug plans to destroy the lake town. Balin pauses and tries to tell Bilbo that it isn't his fault. They talk about killing dragons and stories they have heard of such difficult affairs. Bilbo is worried that the dragon will attack, so he convinces the dwarves to go back into the tunnel. He panics and makes them close the door. The dwarves try to assuage his fears about the transportation of the treasure. Balin and Thorin reflect on their memories of the mountain and the things that were stored there. They talk about an immense gem called the Arkenstone. Bilbo only half listens to their talk and before long he is begging them to shut the door. They hesitate, because they don't know how to open it once it is closed. Thorin gets frustrated and kicks the door shut. Suddenly they hear a smash on the side of the mountain. They flee in to the tunnel. Smaug had snuck out of his lair and over the mountain planning to surprise them. He yells that he will go to Esgaroth and show them who the real king is.