King Arthur
Although his name does not appear on the title of the text, King Arthur is the central character primarily because the eponymous newlyweds marry entirely because of him and the challenge he receives whilst out hunting in the forest.
King Arthur was a mythical king of England, primarily, the southern portion of England, and he is a revered figure who defended England against Saxon invaders in the fifth century. One of the reasons that historians question his existence is that he appears mostly in folkloric stories and epic poems rather than in historical documents. Because of this, many of his acts of courage and bravery seem to stem from beyond the human realm and into the mystical or supernatural arena.
In this story, Arthur is shown to be a man who cares deeply about his knights and his family, and who also has trust in their love for him in return. He knows that Gawain, his nephew, will sacrifice his own happiness by marrying the loathly woman so that his uncle's life is spared by Sir Gromer Somer Joure. Arthur, for his part, seems remorseful about having to ask Gawain to make this sacrifice. The text also shows that Arthur is often challenged in this way, and that he is not a man who backs away from challenges. He is a man of honor.
Sir Gawain
A Knight of the Round Table, Sir Gawain also occupies a special seat at the table because he is King Arthur's nephew and consequently also seems to be Arthur's "right hand man" when called upon. He is very close to Arthur and a loyal family man. He is also a fearsome warrior, honorable, yet courageous and generally unbeatable.
Gawain is often referred to as the Maiden's Knight, and as a defender of women, which is interesting in the context of his behavior in this story. If he is repelled by the loathly woman's appearance, he does not let it show, and treats her as though she is the most beautiful woman in the world.
Dame Ragnelle
Dame Ragnelle is what is known as a loathly lady - a Medieval term for a woman whose appearance is ugly or loathsome. When she first encounters Arthur her appearance is somewhat of a paradox in that she is riding an incredibly beautiful horse. She explains to Arthur the answer to the riddle he is charged with the job of solving and tells him that women want the chance to make decisions for themselves.
Dame Ragnelle, who turns out to be related to Sir Gromer, is spellbound by a curse that has rendered her ugly. She is only to be able to be released from the curse by a proposal of marriage from a handsome knight, at which point she regains her beauty, but in the cruelest of ways; she has to choose between being beautify during the day, or during the night. The final key to her freedom is given when Gawain allows her to make this decision herself. She is a beautiful woman and their union is both genuine and filled with love.
Sir Gromer Somer Joure
A chance encounter with Sir Gromer leads Arthur to fulfill the challenge of solving his riddle. Although he initially seems like a negative character, because he threatens Arthur with beheading if he does not return as agreed with the answer to the riddle, it is likely that he has issued the challenge in the first place with the express purpose of freeing his sister from her spell.
