We analyze observations from the Chandra X-ray Observatory of the southeast knot of the Cygnus Loop supernova remnant. In this region, the blast wave propagates through an inhomogeneous environment. Extrinsic differences and subsequent multiple projections along the line of sight rather than intrinsic shock variations, such as fluid instabilities, account for the apparent complexity of the images. Interactions between the supernova blast wave and density enhancements of a large interstellar cloud can produce the morphological and spectral characteristics. Most of the X-ray flux arises in such interactions, not in the diffuse interior of the supernova remnant. Additional observations at optical and radio wavelengths support this account of the existing interstellar medium and its role in shaping the Cygnus Loop, and they demonstrate that the southeast knot is not a small cloud that the blast wave has engulfed. These data are consistent with rapid equilibration of electron and ion temperatures behind the shock front, and the current blast wave velocity v_{bw} approx 330 km/s. Most of this area does not show strong evidence for non-equilibrium ionization conditions, which may be a consequence of the high densities of the bright emission regions.