Act 2, Scene 1: He cuts himself to pretend that Edgar hurt him and ran away. Actually, though, he had told Edgar that their father was chasing him down because of the note, which wasn't true. This causes Edgar to flee, thanking his brother for warning him. Gloucester, now given a reason to trust Edmund over Edgar, loses all hope in his legitimate son and starts putting his trust in Edmund instead. BAD IDEA! Edmund is beginning a nasty plan to get revenge for being shunned his whole life. This plan is probably going to backfire on him.
Now I wonder if it will backfire at all. Since it is a tragedy, it is very likely that it could end with Edmund on top with more power than he should have. However, it could also end with everybody dead -- including Edmund. By the end of Scene 4, Edmund has pretty much gotten everything he wants.