Luke's ex-girlfriend Rachel arrives in Stars Hollow unexpectedly, and immediately picks up on the attraction between Luke and Lorelai, which they deny. Rachel decides to stay for awhile, which leaves Luke and Lorelai with mixed feelings. Lorelai and Rory are amazed when Emily agrees to excuse Rory from Friday night dinner so that Rory and Dean can celebrate their three month anniversary. When Lorelai arrives for dinner, she discovers the source of Emily's largesse -- her mother has invited another guest -- a man with whom she secretly hopes to fix Lorelai up. After a painful dinner with one of the world's most boring men, Lorelai attempts to escape through the window of her old bedroom, but is caught in the act by Richard. When he is forced to admit that even he is bored by the man, he uncharacteristically covers for her and lets her make her getaway. Back in Stars Hollow, Dean treats Rory to a wonderfully romantic dinner, and then gives her a present -- a car that he's restoring for h

Rachel finds an abandoned inn that Lorelai and Sookie fall in love with; Lorelai and Rachel spend the afternoon getting to know each other and Rachel asks Lorelai to put in a good word for her with Luke; as Rory takes Emily on a tour of Stars Hollow, Emily hits it off with Mrs. Kim and Michel, but becomes distraught when she sees Lorelai and Rory's first home; at Sookie's urging, Lorelai gives Jackson's cousin Rune a job at the Inn.

Lorelai and Rory have a major falling out after Rory goes against her mother's wishes and asks her grandparents to lend Lorelai the money she needs to repair termite damage to their house; Lane's desire to become a cheerleader causes a strain in her relationship with Rory; after an exhaustive and unproductive attempt to raise the funds she needs based on her own credit rating, Lorelai is forced to ask Emily to cosign a loan; Rory drives Paris crazy when she refuses to reveal her PSAT scores.

Rory asks Richard for help in creating and marketing a first-aid kit for Chilton's annual Business Fair, which leads him to realize that he is unhappy in retirement and wants to start a second career; fresh from having underbid on Rory's lunch basket and the loss of the bracelet he made for her, Dean goes overboard in trying to be close to Rory, afraid that she is losing interest in him, and finally becomes resigned to her affection for Jess; at first, Michel is ecstatic when his flamboyant mother Giselle visits, but after Lorelai causes problems for him when she reveals to Giselle that Michel has been holding back from his mother, Michel quickly is driven crazy by his mother's incessant questioning.