Baltimore Det. Jimmy McNulty finds himself in hot water with his superior Major William Rawls after a drug dealer, D'Angelo Barksdale who is charged with three murders, is acquitted. McNulty knows the judge in question and although it's not his case, he's called into chambers to explain what happened. Obviously key witnesses recanted their police statements on the stand but McNulty doesn't underplay Barksdale's role in at least 7 other murders. When the judge's raises his concerns at the senior levels of the police department, they have a new investigation on their hands. Lt. Cedric Daniels is put in charge with Kima Greggs as the lead detective. As for Barksdale, he finds himself demoted to a low-level dealer after his arrest and he obviously has to prove himself yet again.

After two weeks on the job, the team still doesn't have a photo of their principal target, Avon Barksdale. Freamon has a solution when he hears Avon was a Gold Gloves boxer. In the aftermath of the near riot at the towers, Lt. Daniels stands by his men even though he thinks they were stupid to do what they did. He's ordered to lead a raid on the low-rise units in the projects but McNulty rebels and refuses to participate in a raid that's just being put up for show. Dissatisfied with the antiquated equipment they have to work with, McNulty asks his friend at the FBI to lend them listening devices. His friend also has some information for him about Lt. Daniels. D'Angelo isn't around when a gang led by someone called Omar robs his stash.

Avon Barksdale is becoming paranoid and thinks he's being watched. He's also worried his phone is being tapped. He also thinks there's a snitch in D'Angelo's crew and he's told not to pay anyone until it's sorted. D'Angelo isn't too pleased when he hears Avon has given Stinkum a new territory. Judge Phelan visits the squad to sign the warrants to clone D'Angelo Barksdale's pager. The numbers they're collecting are coded and don't make much sense. Det. Prez Pryzbylewski figures it out however. McNulty and Greggs try to get information from Omar.

Avon takes care of Omar's man Brandon but Wallace, who saw Brandon in the arcade, isn't too comfortable when he sees what they've done to him. Avon gives D'Angelo and Wallace a bonus for their good work. The police meanwhile get authorization to place taps for the pay phones used by D'Angelo and his crew but can only listen in when one of their suspects is using it meaning they'll have to keep the phones under constant observation. McNulty is in a tight spot when Major Rawls gives him a week to report back to his old job. When he realizes the connections McNulty's made in the various shootings, he announces he's going to arrest the Barksdales for murder and threatens to mess up the drug investigation.

McNulty uses his children to tail Stringer after a chance encounter in a local market, with one of them getting his license plate. As the detail discuss the implications of the pit pay-phones being disconnected, speculating the crew are going to start using phones outside their immediate area of operations, Herc and Carver prepare for the sergeant's exam. Stinkum, Roland 'Wee-Bey' Brice (Hassan Johnson), and Savino Bratton (Chris Clanton) raid Omar's pad, but he is nowhere to be found. Avon is unhappy when he learns of Orlando's proposal to D'Angelo. Meanwhile, Greggs and Carver arrest a driver picking up a large amount of cash from the towers, but are surprised to learn he is an aide to State Senator Clay Davis (Isiah Whitlock Jr.). Burrell is furious with this turn of events and confronts Daniels about the direction in which the case is heading, giving him one week to charge Avon and/or Stringer. Phelan, however, tells Burrell he wants the full thirty days of surveillance assigned by the court. As Wee-Bey and Stinkum attempt to take over new territory, they encounter an unanticipated problem.

D'Angelo speaks to Wallace, who tells him he wants to go back to school and get out of the Game. However, Malik 'Poot' Carr (Tray Chaney) discovers Wallace has started using cocaine to help him deal with his guilt over Brandon's murder. Freamon gets Sydnor and Prez started on the complex Barksdale money trail, including possible political connections, and they are surprised to find Avon's corporations have been buying up vacant buildings in run-down parts of the city. Greggs and Freamon approach D'Angelo's girlfriend, Shardene Ennis (Wendy Grantham), who works at Orlando's, in the hopes they can turn her into a CI. After Bubbles narrowly avoids a beating whilst stealing a package that turns out to be stepped on, he decides to try to get clean. Avon and Eastside kingpin 'Proposition' Joe Stewart (Robert F. Chew) stage the annual East vs. West basketball game, but when the detail follows Avon afterwards, they get something they never expected. Meanwhile, having already killed Stinkum, Omar sets in motion a plan to gain revenge on Avon for Brandon's death.

Avon, Stringer and Wee-Bey discuss how best to deal with Omar after the attempted hit on Avon, deciding to let him think they want peace, whilst secretly planning to kill him. As such, Omar and Stringer meet for a parley, with security provided by Prop Joe. Meanwhile, Stringer insists on decreasing Avon's visibility in light of the detail's attempt to follow him after the basketball game. An irritable Phelan signs an affidavit for the new phone being used by the pit crew, and Pearlman tells McNulty that he is not up for automatic re-election, possibly because of the feathers he has ruffled due to his involvement with the Barksdale case. D'Angelo tries to understand why Shardene has left him, and after being clean for three days, Bubbles gets some advice from Waylon, before turning to Greggs for support. Meanwhile, McNulty attempts to flip Wallace, and the detail identifies Barksdale's main stash house. However, when Orlando's attempt to purchase weight gets him a lot more than he bargained for, Burrell sees an opportunity for a dangerous undercover operation.

Kima slowly recovers in the hospital. Stringer changes operations in the pit and the towers, rendering the wiretaps and clones useless, and prompting Burrell to begin dismantling the detail. Avon and Stringer meet Levy to discuss where their organization is vulnerable. Unbeknownst to the detail, Wallace returns to the pit to resume work. When Prez starts pulling political campaign finance reports, Pearlman is called to a meeting with a worried State's Attorney, and an angry Clay Davis confronts Daniels. Meanwhile, Stringer issues a difficult order to Bodie and Poot. With Shardene's help, the detail are able to install a camera in the strip club.

Due to the camera at Orlando's, the detail gather enough information to arrest Avon and many of his people, but, with Wallace dead, they are unable to bring charges against Stringer, who's left on the street. However, disgusted that Avon and Stringer had Wallace killed, D'Angelo flips on the entire organization, giving the detail more information than they could have ever hoped for. As Daniels figures out who the snitch is in the unit, Herc is shocked when he is passed over for promotion in favor of Carver, who scored lower on the sergeant's exam. In Philadelphia, Wee-Bey is arrested and gladly admits to murder after murder. Finally figuring out why Avon has been buying vacant properties in the city, Daniels, McNulty, Freamon and Pearlman take their evidence of political involvement to the FBI. Meanwhile, D'Angelo's mother, Brianna (Michael Hyatt), attempts to convince him to stand with the family.

Trying to let go of police work and return to his marriage, McNulty gives up on identifying his Jane Doe. The detectives look into Sobotka and his money. For his union, Sobotka tries to play the political game. D'Angelo wants to live life outside of Barksdale's umbrella and Bell brings in outside help for the problem.

Carcetti maps out a damage-control scenario with the police brass in the wake of a startling revelation from Pearlman and Daniels. Their choice: clean up the mess...or hide the dirt.