"It girl" Serena van der Woodsen has returned to Manhattan after a mysterious and self-imposed exile to boarding school. Serena's best friend, Blair Waldorf, has conflicted feelings about her friend's return since she has enjoyed being the Queen Bee during Serena's absence and might not be ready to relinquish her new position on the social ladder, not to mention the fact that she has always suspected there may be unspoken feelings between Serena and her longtime boyfriend, Nate.

It's the day right after the Kiss on the Lips party and Serena receives a cold reception from her former best friend Blair. Blair reveals that she knows that Serena and Nate slept together, before Serena mysteriously went to boarding school. Then Serena decides to take Dan to Chuck's fundraiser brunch at The Palace. Meanwhile little Jenny asks Blair for advice, and Blair realizes that she maybe gains something by allowing Jenny into her inner circle.

Blair takes matters into her own hands to help Serena with the manipulative and evil Georgina Sparks. Lily, while keeping Rufus in her mind, prepares for her wedding with Bart Bass that is designed to be the Upper East Side's social event of the year. Serena finally tells Dan the whole truth about her past and they try to work things out after Dan has cheated on her, but will it be too late? An unexpected guest shows up at Lily and Bart's wedding. Georgina is sent somewhere where she can do no harm. Blair plans to go somewhere with Chuck.

In a flashback to the 80s, 17-year-old Lily Rhodes gets kicked out of boarding school and runs away to Los Angeles, reconnecting with her parents, Rick and Cece, and sister, Carol. Back in present day, Blair and Nate attend prom together, but the evening doesn't turn out exactly as planned and Chuck and Serena have a little something to do with that. Serena and Lily don't see eye-to-eye over Serena's recent run-in with the law.

After a brief encounter abroad, Chuck and Blair make a promise to each other about their relationship, which leaves them once again apart. Dan, with some help from an unlikely ally, Georgina, is writing a scathing tell-all book that can only mean trouble. As the sole head of The Spectator, Nate is making his own decisions and is ready to go up against Gossip Girl. As word spreads that Serena is missing, the gang bands together to find her and are shocked by what they find.