After seeing the shocking news of Omashu's siege Aang still insists, against Sokka and Katara's warnings, to enter the city in search of Bumi. While in the city, Sokka gets small purple octopus like creatures attached to his face, after removing them, Fire Nation soldiers believe he has disease due to the small pox-like spots left on his face from the small octopus like animal and run, buying the kids some time.
Meanwhile, back on her ship, Azula seeks the advice of her trainers about capturing her brother and uncle. They tell her: "When tracking your brother and uncle the royal procession may no longer be an option. You must be wise if you wish to keep the element of surprise." She takes their advice and decides to put together a small, agile team to track them.
Back in the city, Aang, Katara and Sokka make their way through and decide that wherever Bumi's being held prisoner, is made entirely of metal to prevent his earthbending. Just below them, the governor's wife and children walk; his eldest, Mai, complains about how boring it is in Omashu is, completely unaware that above them two Earthbenders from the resistance have sent large boulders plummeting towards them. Aang sees the rocks heading towards the people below and shoots them out of the way; then people below notice this and attack them. Eventually the resistance rescues the gang.
Azula, meanwhile, has tracked down her first companion for her team: Ty Lee, the daughter of a nobleman who has apparently joined the circus. The two went to the Royal Academy for Girls together. Azula informs her she wants her help in tracking down her, "fuddy-duddy" uncle (but leaves out Zuko). Ty Lee declines her offer and Azula accepts her decision but informs her she staying to watch her show; Ty Lee is not thrilled by this (possibly aware of Azula's motives).
After being rescued Aang is informed that, before even fighting, King Bumi surrendered the city. Aang decides the best thing to do is get everyone out of the city so they can "live to fight another day." Against the leader's protests, they agree. Sokka comes up with the idea to re-create his make-believe, deadly case of "Pentapox" so that the soldiers will allow them to leave the city. After the citizens re-create the spots on their face Aang goes in search while the guards are distracted.
Back at the governor's palace, he and his family watch as the "sick" people roam the streets; he orders the guards to drive them out of the city to prevent it from spreading and be careful not touch them. They're all completely unaware that his infant son has wondered off.
Aang has come across Flopsie in his search; thrilled to see him Flopsie rushes forward but is held back by a chain. Aang frees him by freezing ice to the chain and then smashing it. The two go in search of Bumi.
Momo, who's hungry, finds some berries near where the young infant has wondered off. Interested by Momo's tail, a young boy latches on to him. The two fly throughout the city until the boy finally releases Momo and wonders off further... towards the city's gates.
Back at the circus, the ring master tells Azula how honored he is to have the Fire Lord's daughter at his circus, he informs her to let him know of any way he can the show more enjoyable for her. She smirks while accepting his offer. Up on the high wire, Ty Lee is balancing on a pole that is on top of some kind of round pot. Azula asks the ringmaster if he thinks she'll fall; he replies: "of course not." In that case Azula decides it would be more interesting if she did it without the safety net or better yet set it on fire. Not about to refuse and order from a Fire Nation Royal he sets it ablaze. Ty Lee grows very nervous as it becomes obvious to her that Azula is threatening her to help her in her search. Azula then orders all the animals the circus has to be released inside the tent.
After getting out of the city safely the resistance leader informs the gang that they have one more person then they should. The governor is now aware his son is missing and believes the freed citizens have kidnapped him, and ponders on how to get him back.
Back at the circus, Azula congratulates her friend on the show; Ty Lee decides the universe is telling her to go with Azula.
Katara is playing with the small child and thinks he's very cute, but the leader says he won't be so cute when he's older and a killer. Then a messenger hawk arrives telling them that the governor will trade King Bumi for his son. As they accept the offer, Sokka believes they're walking into a trap, but Aang says he's got a good feeling about this.
Back inside the city Azula, entering in her throne, and Ty Lee approach Mai. Mai, jokingly, asks hopefully if Azula was here to kill her; the two friends hug. Mai is thrilled to help Azula on her mission, wanting anything to get her out of Omashu. Azula confronts the governor who pleas with her, and asks for forgiveness. But Azula, having too much of her father in her, tells the governor he's making a mess of things and also corrects him that there was no more "Omashu." She re-names the city in honor of her father: New Ozai. She decides Mai will handle the trade so he doesn't mess it up.
In front of Fire Lord Ozai's statue Aang, Katara and Sokka approach Azula, Ty Lee, and Mai; ready to trade and they lower Bumi who's trapped in some kind of coffin. But, Azula believes trading a powerful, Earthbending king for a two year-old isn't a fair trade and Mai calls of the deal. They raise Bumi and Aang, angered by this, rushes for him. But unfortunately his turban slips off and Azula sees his arrow and recognizes him. Without a second thought she abandons the original plan and rushes for him. Aang jumps onto Bumi's coffin and attempts to free him the same way as he did Flopsie but Azula is hot on his trail.
Back down on the platform Katara assumes an attack position towards Ty Lee and Mai while Sokka calls Appa. Ty Lee rushes for Sokka; after blocking the attack from Mai, Katara gives Sokka some cover so he can get the baby out.
Nearly to the top of the statue, Aang has almost completely frozen the chain but Bumi tells him to stop but before he can react Azula shoots out of the top and shoots a blast of electricity at the them braking the chain and sending them plummeting towards the Super Slides. Azula jumps into a cart and rides after them. Aang is happy saying "It's just like old times" but Bumi says he needs to talk to him, but Azula blasts at them before he can speak. She continues the chase all the way down the slides.
Back at the platform Katara and Mai exchange blows but from behind her Ty Lee strikes Katara in three different pressure points causing her to be unable to bend. With no way of blocking any attack, Mai pulls out a three-pronged knife but Sokka throws his boomerang and knocks it from her hand. Appa smacks his tail to the ground and knocks Ty Lee and Mai from the platform. Katara and Sokka find Aang being chased by Azula; once close enough to Appa, Aang shoots himself and Bumi of the slide but over shoots Appa and are back on track with Azula. She continues blasting at Aang, Bumi reveals his able to earthbend by using his uncovered face and Azula is forced to come to a stop.
At the bottom of the slide Bumi explains to Aang the concept of jing: choice in battle. Aang says he knows about it: fighting is good jing and retreating is negative jing, but Bumi reveals the third jing: neutral jing, which consists of doing neither and waiting for the opportune moment to strike, which is why he surrendered the city and why he must go back to his capturers. But before leaving, he tells Aang he must learn from a master whose mastered neutral jing.
Now leaving the city, Azula in her throne, with Mai and Ty Lee beside her the converse about their mission. Mai says "It'll be interesting seeing Zuko again, won't it Mai?" and turns to Mai slyly who smiles to herself, possibly harboring a crush for Azula's brother. Azula ignores the comment and tells them that they now have a third target, the Avatar.
Back at the Governor's house, the Governor and his wife are still worried and Aang silently returns Tom Tom to them.