Steve meets a mysterious prankster student, known as the "Phantom of C.U.", while working as a night watchman - his penance for cheating - and feels compassion for him when Steve learns that the student, Larry, is homeless and wants to graduate from college. Meanwhile, Clare, and later Donna, try to arrange a blind date for Kelly, which turns out less-than-satisfying when the guy, an Englishman named Neil Phillips, annoys her. Donna begins a new career for herself as the weather girl on CU TV, which unfortunately nets her an unwanted fan. Tracy helps Clare work on the new college yearbook, and David becomes suspicious of Tom's true motives while helping to get the singer Donna Lewis to perform at the After Dark.

Donna thinks that her stalker is Garrotte Slan, the man who tried to rape her two years ago. Kelly and Clare decide to cheer Donna up by taking her out on the town to a male strip club, where the unseen stalker turns up the heat by attempting to run over Donna with his car. Meanwhile, Tracy and Brandon's weekend alone at her parents' ranch is interrupted when Sam, Tracy's ex-boyfriend, shows up. Steve leads Dick Harrison and fellow frat brothers in a sewing circle to salvage an investment of a Super Bowl T-Shirt sellout. Also, David and Tom team up to produce a Super Bowl party at the After Dark, much to Valerie's annoyance.

Despite Valerie's warning to stay away from him, Kelly decides to pursue Tom, which adds an extra dimension when he and Brandon, who still holds feelings for Kelly, face off in a hockey game. Donna is denied a permanent restraining order against Slan, while David becomes overprotective of her. Meanwhile, Tracy lets slip the three words "I Love You" to Brandon. Also, Clare and Steve's weekend of house-sitting at a bungalow prompts talk of them living together.

Donna's stalker, who is finally revealed to be a disturbed TV station worker, named Evan, takes her, Brandon, Tracy and a group of other people hostage in the campus TV station, where Brandon tries to calm down everyone's heightened tensions as Donna sits in front of the running cameras with a gun to her head. Meanwhile, Steve and Clare travel with their parents to a getaway in San Diego where they try to cool down the burgeoning romance between them. Also, Tom and Kelly's attraction between each other increases and David finds himself drawn to Chloe Davis, a aspiring singer determined to make it big.