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- "The centerpiece of the carnival is the clock tower, and on the eve of all the festivities, the doors to its roof are opened... From atop the clock tower roof, a ceremony to call the gods is held and an ancient song is sung."
- — Anju's Grandmother
The Clock Tower stands in the middle of Clock Town, which in turn lies in the center of the four areas that make up Termina. The tower is the focus of the Carnival of Time, the preparations for of which can be seen in progress throughout the game. On the night of the third day, the Clock Tower "opens" for the celebrations. This is done by the clock and light rising upwards, then pivoting as the lighthouse segment atop the tower drops to a horizontal position, causing the connected clock face to fall flat, providing a platform for the celebrating townspeople. The staircase to the clock face is usually accessed via a Festival Tower constructed each year in the town square, though the impending fall of the Moon prevents the tower's completion during the events of the game, as many of the Carpenters flee the area. In his Hylian or Zora form, Link can climb into the Clock Tower on the night of the third day via a ramp and small platform. However, during the first three-day cycle of the game, Link is trapped in Deku form and must procure the use of a Deku Flower in order to access the tower's top.
In an underground chamber of the tower lies a subterranean river and a water wheel, which is likely what produces the rotating of the tower's clock and lighthouse. This chamber is where Link meets the Happy Mask Salesman early in the game. Connected to this room is a series of tunnels that lead from the previous land Link was in (presumed to be Hyrule), but these are only visited once, as the way is sealed when Link passed from them. The water here also contains an easter egg; if Link explores the river's bottom using his Zora form, he can find strange clumps of algae which appear to have ghostly images of Nintendo 64 controllers within them.
The masked Skull Kid can be found on the top of the tower, along with Tael. When Link first confronts the Skull Kid here, he must take back his stolen Ocarina of Time, at which point he must play the "Song of Time" so as to loop time back to the beginning of the three-day cycle. After liberating the Four Giants, Link must again confront the Skull Kid atop the tower. He plays the "Oath to Order", summoning the Four Giants to halt the descent of the Moon, triggering the game's finale.
At the beginning of each three-day cycle, Link emerges from the ground floor of the Clock Tower and into Clock Town's square, at a time immediately following his original conversation with the Happy Mask Salesman. Strangely, the time remaining before the impact of the Moon does not count down whenever Link enters the Clock Tower's underground chamber, and the in-game clock is not displayed. This could possibly be interpreted as a power of the Happy Mask Salesman, or may be an artifact of the game's mechanics; since Link is meant to begin each three-day cycle by exiting the Clock Tower, having already spoken with the Happy Mask Salesman, time does not pass in any of the rooms Link visits prior to leaving the tower. As the tower's basement is the only one of these rooms Link can return to later, the absence of time's passage may be a result of the room being designed for use before the normal passage of in-game time. Additionally, the tower's basement is also where Link is restarted should he suffer a Game Over from allowing the three-day cycle to end without looping time, and thus time must again be frozen there to ensure Link exits the tower exactly at the dawn of the first day.