A widowed mother named Julia Sanderson (Patricia Neal) learns she has a terminal illness and, with no close relatives to care for her three children, John Jr., Carl and Alicia, she gets Charles to promise to find the children a new home after she dies. Meanwhile, Laura and Mary rescue some abandoned puppies, and the relationship between Mr. Edwards and Grace Snider begins to blossom.

After Julia Sanderson's death, her three children stay with Grace, with help from Mr. Edwards. When Charles is unable to find someone to adopt all three children, he has to make the difficult decision to place them in separate homes. At the very last minute, Mr. Edwards makes a monumental decision: he marries Grace - and they take on all three children.

John is a lot more interested in books than farming or hunting. Mr. Edwards tries to make him different and buys him a gun for his birthday.

Charles, Mr. Edwards, and two other men take a job that involves handling and transporting explosives. They must deal with many things along the road, including prejudice.

The Independence Day celebration in Walnut Grove is threatened when taxes are increased. A Russian immigrant shows the people why America is a great place. Even though the immigrant lost his land since he couldn't pay his taxes, he was happy to be in America. He considered it to be the best place to live in the world.

After a tornado ruins his crop, Charles decides to sell the land and return to the Big Woods of Wisconsin without consulting his family.

Reverend Alden gets sick while collecting donations. Caleb Hodgekiss, an ex-convict, helps the Reverend by giving him a place to stay and volunteering to get the donations from Walnut Grove. Caleb poses as a friend of the Reverend so that he might get donations which he initially planned to keep for himself.

Charles' father, Lansford Ingalls, doesn't want to live after his wife dies. Charles brings his father to Walnut Grove to help him out. When Laura's horse gets hurt, she blames her grandpa.

Lansford leaves because he feels really bad. Once Laura realizes that her grandpa wasn't to blame for the accident, she looks for Lansford and convinces him to come back home.

Mary and John have fallen deeply in love and want to get married, but John has a problem. He must decide if he will accept a scholarship and go to college or stay with Mary. At first Mary doesn't want him to go until she and John both realize that he must take the scholarship to try to make his dreams of becoming a writer a reality.

Mr. Edwards and Doc Baker help a nearby town with an epidemic case of mountain fever. When Mr. Edwards returns, a quarantine is placed on Walnut Grove. Alicia, Mr. Edward's adopted daughter comes down with the disease. Mr. Edwards tries to help his daughter. Laura, not knowing about the disease, goes to visit Alicia and Mr. Edwards. Laura ends up taking care of the both of them while they recover.

The school children are allowed to put on plays in groups. Laura and Mary work with Ginny Clark, a student who has no father. Ginny wants her mother to date, but her mother, Della, doesn't believe she looks good enough. Ginny sells her long beautiful hair so she can buy her mother a new dress. Della at first accuses Ginny of stealing money until she sees that her daughter has cut her hair.

Mary has an accident with a horse in the barn. When Mary starts to get worse, the Ingalls take her to a specialist. There they learn that Mary needs an immediate operation.

After having their crops destroyed, the Ingalls leave Walnut Grove to try their luck at striking it rich. After being at the gold mines for a while, the Ingalls realize that greed has been poisoning their minds. They leave to go home instead of looking for more gold.

Charles stays with a family while looking for some horses to buy. The children of the family asks Mr. Ingalls if he could possibly do something to keep their parents from splitting up. Thanks to Charles talking to the husband and the wife, they decide to stay together and work things out.

When Isaiah Edwards loses his will to live after a crippling logging accident, a letter to Walnut Grove from his worried wife, Grace, brings Charles and Laura back to the big woods to try to help their old friend.

Mr. Edwards' alcoholism, fueled by John Jr.'s violent death, ruins his marriage, and he travels back to Walnut Grove to see solace with his old friends. However, those long-standing friendships are put to the test when an accident, caused by a drunken Mr. Edwards, nearly costs Albert his life.