The soldier has just pulled his sword — his left hand still holding on to the scabbard. Death, sporting a large moustache, blocks the soldier's sword-arm, while aiming for the final, deadly blow. Another soldier is lying on the ground.
The picture demonstrates how Holbein deviates from the older "proper" dances of death. Earlier on, Death was simply a messenger, who announced the event of death. The picture to the left is from the dance of death in Holbein's hometown, Basel. Here the knight meets Death in armour, but there's not a hint of a battle — Death wears the armour in order to ape and taunt the knight. With Holbein, Death is an aggressor, who grabs people and drags them away. Therefore it's only logical that when Death meets a person who's able to defend himself, a duel ensues.
In Holbein's dance of death (image to the right) Death attacks the soldier with a bone. The larger image makes it possible for Holbein to include more dead soldiers lying on the ground. In the background Death is beating a drum - calling more soldiers to the battle.
The accompanying text for this letter goes: »Wer ist der mensch der würdt leben / vnd nit wurdt sehen den todt / der würd erlösen syn seel von der handt der helle«.
This is from Psalms 89,49 which in Luther's version sounds: »Wo ist jemand, der da lebt und den Tod nicht sähe, der seine Seele errette aus des Todes Hand?« In English: »What man is he that liveth, and shall not see death? shall he deliver his soul from the hand of the grave?«