Dungeon 3, known as 'The Manji' due to its distinctive shape, is located in the northern part of the Overworld, within the Lost Woods. To reach it, head north from the starting cave until you reach the northern edge of the map. Then, head west two screens. You'll enter the Lost Woods, a maze-like area. To navigate the Lost Woods, you must follow a specific path: North, West, South, West. Deviating from this path will return you to the beginning of the woods. After successfully navigating the Lost Woods, you'll find the entrance to Dungeon 3.
This dungeon introduces new challenges, including Bubbles, which temporarily prevent Link from using his sword, and Rope, snake-like enemies that move quickly. You'll also encounter more complex puzzles involving pushing blocks and using your Boomerang effectively. Ensure you have a good supply of Bombs and a strong understanding of your Boomerang's utility.