Original: In Faust's study, the poodle transforms into the devil (Mephistopheles). Faust makes an arrangement with the devil: the devil will do everything that Faust wants while he is here on Earth, and in exchange Faust will serve the devil in Hell.
Simplified: The devil (usually called Mephistopheles, as he is in Goetheâ s play) tells Faust he can help him to do this, but that in the end Faust will have to give him his soul and go with him to hell.