For a three-act plot analysis, put on your screenwriter’s hat. Moviemakers know the formula well: at the end of Act One, the main character is drawn in completely to a conflict. During Act Two, she is farthest away from her goals. At the end of Act Three, the story is resolved.
Act I
It Could Be Bunnies
Lennie and George plan to get a job on a ranch near Soledad, California where they can earn some money to realize their shared dream: their own little place, where George can have freedom and Lennie can have… rabbits.
Act II
Meanwhile, Back at the Ranch
After only three days, things aren't going so well: the ranch is full of petty cruelty, competition, and general malaise. There's one moment of hope when Candy offers to pitch in some money for their ranch dream, but that's quickly shattered when Lennie accidentally kills Curley's wife. Curley is out for blood, and even Slim admits there's got to be some consequences.
Act III
Mercy Killing
Out of options to protect Lennie, George finds Lennie, lulls him into a comfortable, happy place talking of the dream farm, then … shoots his friend in the back of the head. Poof, a dream destroyed.