"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.