Hypnotism is a technique incorporated into book the fourth, The Miserable Mill. When Foreman Flacutono trips Klaus and breaks his glasses, Klaus is sent to Dr. Orwell to have them repaired. While there, Dr. Orwell forces Klaus into an extended hypnotic state. When he returns to the lumbermill, Violet and Sunny notice that Klaus is constantly tired, obeys Flacutono's every whim, and makes simple mistakes such as calling Violet "Veronica." The next day he even goes so far as to severely injure Phil, a fellow employee. In the process of the accident, Klaus becomes himself again, but is immediately sent to Dr. Orwell a second time. When the children realize that Klaus is under hypnosis, Violet and Sunny search the library for a way to break his trance. They discover that while under hypnosis, Klaus will obey any order that is accompanied by a key word. They also read that another specific word will break the trance completely. The girls rush back to find Klaus about to cause another accident, this time a fatal one. They notice that Flacutono is controlling him with the word "lucky", and when Violet recalls that Klaus's first trance was broken when someone said the word "inordinate", she is able to return Klaus to his normal self.
While the exact process of succumbing Klaus to hypnosis is not explained, it is inferred to be some sort of scientifically viable procedure (as opposed to one induced by magic, etc.).