Keith stays with Alison while his estranged wife, Lily, is in town for the weekend. Alison is wracked with guilt after Lily confronts her in a dream, and recalls the despair her mother suffered following her father's affair. After bailing out of a camping trip, Alison drives to Keith's house to catch a glimpse of Lily. She realizes that she can't continue the affair. Matt's parents refuse to support his lawsuit because they fear it would damage their reputation. He finds a lawyer who will work for free, provided that he let her use the case to publicize the issue of anti-gay discrimination. Rhonda's ""efficient"" new roommate turns out to be completely anal-retentive.

Alison undergoes successful surgery, and Billy agrees to care for her when she returns home from the hospital. They both become frightened by how much they have come to care about each other. Jake and Jo observe that the necklace Billy plans to give Alison for Christmas is more than a ""friendship"" present. Billy disagrees, but decides not to give Alison the gift after she makes him agree to a ""no presents"" pact (because she is short on cash). Alison fears that she has hurt Billy's feelings. She later apologizes, and he gives her the necklace. They admit that they have become confused by their feelings. Jo and Jake try to overcome their unhappy memories of Christmas. He is excited about making a fresh start, but she remains cynical and wants to ignore the holiday. She also tries to push Jake away, but they end up having a hot make-out session. Michael is depressed when he and Kimberly cannot save a young gunshot victim, but his spirits are revived after delivering a baby for t

Billy's father dies of a heart attack. Amanda tries to exploit Billy's vulnerable state to seduce him, and then shows up at the funeral in an attempt to score points with her ex. Alison flies back from Seattle to comfort Billy. Billy feels that he let his father down, and decides to take over the furniture store. His mother says that she has sold the store to the employees, and that she wants Billy to use his writing gifts. She gives Billy a letter in which his father expressed his pride in him. Billy drives Alison to the airport, but she decides to move back to Los Angeles. Michael tries to convince Kimberly to move in with Billy, but she declines. She explains that seeing the death of his father reminded her of how much involvement she would have in his life if they were roommates. Michael lies about going to the hospital and instead helps Kimberly with a plumbing problem. She offers him dinner and tries to come on to him, but he resists. Billy's family tragedy prompts Matt to

Zack encourages Alison to buy an expensive new car and skip work. Billy and Susan confront Alison during Thanksgiving dinner, but she reacts angrily and storms out. A drunken Alison tries to drive to Zack's house, but he is having a party with his friends. While distracted by her phone, she crashes into a boy on a bicycle. Kimberly explores several motherhood options, some of them illegal. She invites Jo over for Thanksgiving and convinces her to fake a miscarriage and hide her baby from the Carters. A mobster's associates begin harassing Jake. Sydney is told that Jake will suffer a serious accident unless she sleeps with the mobster's friend--Chris. Amanda leaks information about Bruce's health, while Peter prepares a takeover attempt. Matt and Jeffrey refuse to come to Thanksgiving dinner after Matt's parents ask them to hide the true nature of their relationship.

Kimberly sets off her bombs, destroying half of the building. MacKenzie suffers a fatal heart attack. Billy breaks down Alison's door and pulls her to safety, although she is blinded by the blast. Peter saves Kimberly from drowning after the impact knocks her into the pool. Kimberly is placed in the psychiatric ward, and is unable to recall the events of the past week. Billy storms out when Hayley calls him to task for not immediately taking Brooke on their honeymoon. Brooke later moves out of the mansion and into Billy's apartment. Jess is killed in the fall from the construction site, while Jake suffers only minor injuries. He shuns a guilt-ridden Jo. The jailed Matt is enraged when his parents seem to suspect that he is guilty of murder. They win back his trust when they put up their mortgage to bail him out of jail.

Amanda is incensed when Brooke secures Jack's cable company as a client for D&D. Michael hires a waiter and aspiring actor named Mark Paul to impersonate Henry. Amanda holds a ""We Survived the Blast of '95"" party in the courtyard. Kimberly receives permission to drop by the party with Peter to apologize for her actions. Amanda agrees to forgive her. Mark Paul hides in the laundry room and startles Kimberly. Jane declares war on Jo over the broken engagement. Shelly throws herself at Jake during the party, as Jo is working late with Richard. Alison sleeps with Hayley. Brooke tries to convince Alison that Hayley is a womanizing pig. Matt's parents suggest that he use his settlement to return to medical school. Matt's father dies of congestive heart disease. When Amanda goes to Jack's house for dinner, she learns that his fiancée does not exist. He declares that he will never let go of Amanda.