Brandon and Mark find the perfect newscaster - a student named Tracy Gaylian - for the campus TV station, but she panics and gets drunk prior to her debut. Meanwhile, an accident with Jimmy gives Kelly a big scare about having AIDS. Mel withdraws David's financial support after learning from Donna that he dropped out of college to concentrate on his film making career. Elsewhere Valerie continues her secret affair with Kenny, who must find the time to be with her.

Steve meets a mysterious prankster student, known as the "Phantom of C.U.", while working as a night watchman - his penance for cheating - and feels compassion for him when Steve learns that the student, Larry, is homeless and wants to graduate from college. Meanwhile, Clare, and later Donna, try to arrange a blind date for Kelly, which turns out less-than-satisfying when the guy, an Englishman named Neil Phillips, annoys her. Donna begins a new career for herself as the weather girl on CU TV, which unfortunately nets her an unwanted fan. Tracy helps Clare work on the new college yearbook, and David becomes suspicious of Tom's true motives while helping to get the singer Donna Lewis to perform at the After Dark.

Donna's stalker, who is finally revealed to be a disturbed TV station worker, named Evan, takes her, Brandon, Tracy and a group of other people hostage in the campus TV station, where Brandon tries to calm down everyone's heightened tensions as Donna sits in front of the running cameras with a gun to her head. Meanwhile, Steve and Clare travel with their parents to a getaway in San Diego where they try to cool down the burgeoning romance between them. Also, Tom and Kelly's attraction between each other increases and David finds himself drawn to Chloe Davis, a aspiring singer determined to make it big.

Kelly learns that her old engagement ring that Brandon bought for her years ago is the cause of the continuing friction between him and Tracy. Meanwhile, Donna can't decide whether to be with Cliff or David, while Chloe makes a move on David after she tells him that Donna is not the woman for him. Clare tells Steve to give one of his step-brothers, Ryan, an advance talk about the birds and the bees. Valerie finally confronts her mother and tells her the true, long-kept facts behinds her father's suicide which are: her father killing himself on the day Valerie and Tom threatened to go to the police with the fact that he's been molesting her. Also, Abby then flies back to Buffalo and Tom soon follows suit.