Clare returns after a few days out of town, and the gang fills her in on the events that transpired over New Year's. Susan's ex-boyfriend Jonathan came to town and irritated Brandon with his constant presence. On New Year's Eve, he revealed that he was still in love with Susan and hinted that he shared a mysterious connection with her. Jonathan planted an extra-long good night kiss on Susan, prompting Brandon to challenge him to a fight. Colin convinced Valerie to hold onto his coke supply so that Kelly would not realize that he was still using. Val drove the wasted Colin home on New Year's Eve, leading to a dispute with David. Kelly blamed Valerie for Colin's addiction, so Val turned over the coke to her and washed her hands of the whole thing. The bird that Joe gave to Donna for Christmas escaped from the apartment. David, Donna and Joe spent hours trying to coax the bird out of the tree. Joe snapped at Donna for not showing compassion for the bird, but then showed up at the Rose Par

Rush dumps Ryan and Austin off on Steve on the same day that he is hosting a fraternity party. He doesn't keep a close eye on the boys, and they drink everything in sight. Ryan becomes very ill and Greg (Kelly's med student date) diagnoses him with alcohol poisoning. He has to be rushed to the hospital, and his father blames Steve. Kelly invites Tara to stay with her after she finishes her stint in rehab. Tara becomes enraged when Kelly dates Greg, as she wants all of Kelly's attention. Colin's lawyer recommends that he plead guilty in exchange for a short sentence at a minimum security facility. Valerie persuades him to take the deal. Val goads Colin into attending Steve's party, but bristles when he shares a tender moment with Kelly. Donna and David videotape the party for a late-night campus program called C.U. Later.

Colin plans to board a ship and sneak out of the country. He convinces Claudia, his former art dealer, to wire him the $10,000 passage fee. Valerie seeks Jonesy's help to track down Colin, and he sends her a handsome FBI agent. Carl throws Steve a huge 21st birthday bash aboard the Queen Mary and invites all his friends. Andrea surprises Steve by flying in for the party. David and Donna put together a video birthday greeting from friends and relatives who couldn't make the party. They send an inquiry to Brenda's address (she is actually on tour in Scotland), but receive a reply from Dylan. David helps Donna fight off the advances of their lecherous boss. She cools him off by revealing that she is a virgin, and he decides to hit on Kelly instead. Susan receives a chance to work on the presidential campaign. Brandon does not want her to go, and reminds her that he turned down his newspaper job in favor of their summer trip. Joan feels under the weather as she and Nat attend Steve's party

The Beverly Hills Beach Club holds its annual reunion. Steve reminisces about his relationship with Kelly, as he lost his virginity to her on the beach in 9th grade. Clare is disturbed to learn of the couple's history, and comments on the ""incestuous"" nature of the group. Steve confesses that he spread rumors about Kelly after their break-up, causing her to gain a reputation as a slut. Kelly is hurt, but eventually decides to forgive him. Ryan blows a chance at a date when Austin convinces him to spy on the girl as she undresses. Steve gives the boys a lecture about treating women with respect. David continues to dump all over Donna for quitting the music video business. He harasses her when she talks and dances with another guy, and they decide to break up. Kelly goes to work at an AIDS hospice to complete her summer school credits. Mark Reese, the general manager of the campus television station, recruits Brandon and flirts with Kelly.

Valerie becomes depressed when her mom, Jim and Cindy all fail to come to graduation. She tries to make amends with Kelly after overhearing her push Brandon to evict her. Val pleads with Steve to lobby Brandon on her behalf, but he still kicks her out. She checks into a motel across the street from the bluff where she once contemplated suicide. Brandon finds a suicide note and learns Val's probable location from David. Donna ponders taking her relationship with David to the next level. David helps Steve and Muntz with a senior prank. Kelly is furious when her father insists on attending her graduation. The gang receives invitations to a special grad party with a ""roaring '20s"" theme. Kelly's sister Joy confesses that Bill is responsible for the event.