Cash comes across a character called The White Rabbit and is instructed to follow him. As soon as Cash leaves the room where the scene has started and enters the first cellblock in this level, one of the Smileys runs out of the shower block and hits the switch on the wall, which closes the gate from the cellblock, trapping Cash in it, and opens the cells. Four hunters will try to kill Cash with meat cleavers. Cash kills all of them, opens the gate and continues following the White Rabbit. He then fights several Smileys with shotguns and is instructed to get up to the watchroom, where "Mister Rabbit has left a gift" for Cash. When Cash reaches the watchroom, it starts to fill with armed Smileys. Cash survives this wave of hunters and carries on. After passing narrow hallways, killing the Smileys along the way, he enters the workshop, where Starkweather tells him that this is the part of the movie where Cash is supposed to die, and after that the Rabbit leaves the prison's main building. Cash shoots his way to the freedom, killing all the Smileys in the workshop, and gets out of the prison. The White Rabbit is shocked to see Cash alive, and heads to the watchtower. Realizing that the Smileys didn't killed Cash, Starkweather sends the Cerberus reinforcements to eliminate him. Cash, however, wipes them off, kills the White Rabbit, grabs the prison's gate key and escapes the Darkwoods Penitentiary, thus ending the scene.
Before the game's release, Kill the Rabbit was once known as Pool of Tears.
Two beta Cash corpses can be found. One is tied to the electric chair and the other is lying dead on a bed near the end of the asylum.
Just before the room where Cash kills the last of the Smileys, there is a locked door with a sign above it that says: Penitentiary Armory. There is a switch in the next room that opens it and inside are 3 Shotguns.
In a room, where you can find dead bodies in bodybags lying on tables, there will be a painkiller, behind one of the tables. If you go to pickup the painkiller, one of the corpses will get up, make a scary noise, then it lies back to the table.
At the end of the level, there will be a Cerberus guard inside the Penitentiary that can be seen through the windows. If you leave two corpses in the platform that are needed to open the gate, one of them will still be there and you'll be able to return and find him. Despite showing alert status if he sees you, he's completely harmless and is the only Cerberus in the entire game that is unarmed. You can kill and even execute him without problems.