After Dawson gets a $2,500 grant from the Boston Filmmaking Association following his win with his horror film, he asks Joey to help him work on his next film. But she refuses for she wants to have a life of her own. That evening, Joey's 'semi-date' with Jack for a moonlight picnic prompts a resentful Dawson to join Jen at a bash house party, thrown by Chris Wolfe, where she gets drunk once again and he ends up saving her from doing some things she'll regret. Meanwhile, Pacey proves his worth when Andie's mother has another psychotic breakdown during a study session at her house. Also, Mitch cannot understand Dawson's views on their divorce.

Andie decides to run for student body president and asks a reluctant Joey as her running mate. But Andie's run lands her on a campaign trail of tears when the devious Abby learns and begins advertising her dysfunctional family situation. Meanwhile, Jen helps Dawson take steps to deal with his powerlessness over his parent's divorce by taking him out on a delinquent spree of pranks as well as a moonlight swim in the nude. Also, Jack shuts out Joey for he does not want to talk about his family problems with her or anyone.

Capeside High is abuzz with the gossip mill after Jack bares his soul in an English assignment and is forced to explore his innermost secrets while reading a poem he wrote out loud in class, leaving Dawson, Joey and Andie shaken by the implications of what it all means: Jack happens to be gay. Meanwhile, Pacey tries to defend Jack in the face of his adversarial English teacher, Mr. Peterson, and ends up getting in trouble when he assaults the petulant Mr. Peterson which causes a riff between Pacey and Andie. Also, Jen finds Ty Hicks to be full of surprises.

Dawson's suspicions about Mike Potter become confirmed when he sees him selling drugs again and is torn on whether or not to tell Joey or leave things as they are. But Pacey's grumpy and misanthropic father, Sheriff Witter, is already suspicious and has the Ice House staked out hoping to catch Mike Potter in the act in which the restaurant is set afire by Mr. Potter's competitors. Meanwhile, Gail tells Mitch that she has decided to take the job offer in Philadelphia and wants to leave as soon as possible with Dawson. Pacey becomes more depressed as his school grades start decreasing now that Andie is gone from his life and his domineering father verbally bullies him. Also, Jen becomes more and more depressed over Abby's death in which Jack wonders if she is suicidal. Eventually, Grams asks Jen to come back to live with her and Jack is welcome to live with them too.

Nominated for Capeside's Homecoming Queen, Jen wins and is put in charge of planning the Annual Homecoming Queen Gala, where she shocks the prim-and-proper committee president, Constance Freckling, and the entire town with the entertainment, while Jen also asks the painfully sky Henry to be her date. After Joey and Pacey save Andie from the libidos Rob, she wants to get back together with Pacey. But Joey becomes suspicious that Andie may have orchestrated the event to make Pacey her savior. Meanwhile, Dawson is distressed with his mother, Gail, unexpectedly returns from Philadelphia, and soon learns that she was fired from her job, while he is torn about telling Jen the scandalous secret he has about the departed Eve.