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The second part of the exam is a survival exam in the The 44th Battle Training Zone, aka "The Forest of Death". During this part, Naruto found himself in a desperate situation against Orochimaru, an S-Class missing-nin from Konoha so powerful that the Third Hokage later mentioned that there was nobody in Konoha that could fight him equally. It turned out that Orochimaru used to be one of the Third Hokage's pupils, also known as the Sannin. Naruto and Sasuke's reactions to the situation were a complete reversal of what had happened in the Wave Country mission – Sasuke was frozen with fear while Naruto fought on fearlessly, at one point stopping Orochimaru's huge summoned snake in its tracks on his own (with the help of some demon fox chakra), and muttering to Sasuke, in a moment of glorious retribution that marked another milestone in their rivalry, "You're not hurt, are you ... scaredy-cat?"

Naruto eventually snapped Sasuke out of his panic. However, Orochimaru used the Five Elements Seal on Naruto, disrupting the flow of the demon fox's chakra, as well as Naruto's own.

However, Orochimaru was too much for Sasuke as well. In the end, Orochimaru put a Cursed Seal of Heaven onto Sasuke's neck, saying that Sasuke would eventually come to him for the power he needed to kill his brother, Itachi Uchiha. Orochimaru then left, sending his three Genin, Team Dosu from Otogakure, to go after Sasuke.

While both Naruto and Sasuke were unconscious from the fight against Orochimaru, Sakura had to take care of them. It was there that Sakura's personality reached a turning point. As Kin Tsuchi of Team Dosu trapped her by roughly holding her by her hair, Sakura realized how pathetic her behavior was, always criticizing others, when she was the one who hadn't improved at all. She reflected on herself, thinking how she was always telling Naruto that she was better than him, when he had been the one who was consistently improving, and telling Sasuke she loved him when she couldn't even muster up enough strength to protect him as a teammate, before she symbolically freed herself by cutting off her long hair with a kunai, which she had initially kept long because Sasuke supposedly liked girls with long hair. She also had to fight against the Sound Genin, and resolved to no longer be dependent on her teammates. The three Sound Genin were pushed back, with the aid of Team 10 and Rock Lee, whose efforts seemed to be worthless before Neji Hyūga and Tenten showed up. Dosu Kinuta, the leader of Team Dosu, mentioned that Neji could "see through them", but before Neji could attack, an awakened Sasuke intervened.

The Cursed Seal Sasuke now had started to take effect, as, in a state of insanity and murderous intent, Sasuke defeated Zaku Abumi of Team Dosu, going as far as to dislocate his shoulders for no other reason than to cause him pain. Before he could do any more damage to anyone else, however, Sakura hugged Sasuke, crying and begging him to stop, allowing Sasuke to regain control of the Seal. Dosu left with his teammates, wondering why Orochimaru had sent him to kill Sasuke if he knew Sasuke had the Cursed Seal. Team 7 still managed to make it past the second stage by defeating Oboro and his team with a little help from Kabuto, a fellow ninja from Konoha.