The scene opens with a pan over the Northern Water Tribe city and then moves to a sparring match between an anxious young man and a confident Katara. After Katara swiftly defeats her opponent by encasing him in an ice formation about 20 feet high and taking away his ability to waterbend, Master Pakku releases the student, Pupil Sangook, unceremoniously on his back. Pakku then asks the other students (who look as though they've already had similar run-ins with Katara's waterbending that day) if any of them feel up to facing Katara again. Hearing no response, Master Pakku then tells Katara that she has progressed faster than any other student he has had and that her hard work and determination have paid off in ways that raw talent alone cannot. Seeing Aang playing with Momo, Master Pakku cynically asks Aang if he wishes to face Katara since he must have mastered waterbending already. Unconcerned by Pakku's tone, Aang responds by saying he wouldn't say he's mastered waterbending, but he has something to show Pakku. Aang then wraps snow around himself as if her were a snowman; which does not impress either Master Pakku or Katara. Meanwhile, Sokka is walking on a ledge of an ice bridge as Princess Yue walks on the bridge beside him. She asks if there are not any palaces in the Southern Water Tribe. Sokka says, "I grew up on a block of ice. It's not exactly a cultural hub". As Sokka comes down from the ledge, Yue touches his shoulder and laughs at his statement. Then her smile turns to a frown as she says what they are doing is wrong because she is engaged. Undeterred, Sokka says they are just friends and he would like her to meet another of his friends – Appa.
Appa greets Sokka by pushing him to the ground and giving him a big lick, which leads Yue to giggle and say, "It looks like you haven't been giving Appa enough attention." Sokka and Yue get into Appa's saddle and Sokka introduces Yue to the joys of flying with a simple "Yip… yip". Yue is amazed but wonders if it is always cold when flying (and then scoots closer to Sokka). Sokka softly replies, "Not when you're with someone". They look into each other's eyes and begin to move toward a kiss. When they realize what is about to happen, they blush and quickly try to change the subject. However, the subject presents itself in the form of gray snow falling on them.
The scene cuts back the Northern Water Tribe city where we see gray snow falling. While Aang is rolling in the snow around Momo, Momo eats one of the gray particles and coughs it out, which gets Aang's attention. The water fountains have turned gray as a result of this unusually snowfall and Water Tribe citizens look on wonderingly.
Sokka and Yue have landed on a nearby glacier and Sokka tells Yue he recognizes the gray as soot from Fire Nation ships mixed with snow as this happened when the Fire Nation attacked his village. He tells Yue the Fire Nation has closed in on the North Pole and from what he sees there are a lot of them. The camera pans out onto the horizon to show a huge gray cloud in the distance.
Several Fire Nation ships are shown in the water (presumably heading to the North Pole) and Admiral Zhao sinisterly tells General Iroh they are in the process of writing history as they will be destroying the Water Tribe civilization. Iroh warns Zhao that history is not always kind to its subjects. Zhao condescendingly assures Iroh that this will not be like Iroh's legendary failure at Ba Sing Se; to which Iroh ominously tells Zhao he hopes not, for Zhao's sake. Zhao tells Iroh to tell the captain to prepare for first strike and Iroh departs. Subsequently, Iroh finds Zuko in disguise as a guard, tells him they will be landing soon, and inquires if Zuko has a plan. "I'm working on it, Uncle" he replies.
Back at the Northern Water Tribe, a large drum adorned with the water tribe's symbol is beaten as citizens rush to the main gathering hall. As Sokka and Yue head up the steps, Yue abruptly stops to tell Sokka they cannot see each other because she is engaged and she likes him as more than a friend.
At the gathering hall, Chief Arnook tell the citizens that war is upon them and he is saddened to know that some of the faces he sees may vanish in the next few days. He calls upon the Ocean and Moon Spirits to be with them as they face the battle for existence. When the Chief asks for volunteers for a dangerous mission, Sokka is first to stand and say, "Count me in" - despite Katara's objection. As Sokka receives his mark from the Chief signifying his acceptance to join the mission, Yue looks on and as he heads back to his seat Yue looks away blinking tears from her eyes.
As they await first strike from the Fire Nation, Chief Arnook tells Aang the stillness before battle is unbearable. A hundred years ago Aang was not there to help his people; he emphatically states that this time he will make a difference. Finally, as the Water Tribe warriors look on, there is a WHOOSH as the first fireball is launched. The fireball strikes the middle of the Northern Water Tribe emblem on the outer wall throwing many back by the blast. A second fireball lands in the heart of the city and as the third approaches, Aang yells "Yip, yip" to Appa and they head out to face the Fire Nation Navy.
Several fireballs are launched by the lead ship and as Aang approaches he manages to deflect one fireball into the nearby ice cap. He then leaps off Appa, expands his glider and maneuvers between soldiers' fire blasts as he then lands on the deck and sweeps away those attacking him. After several maneuvers disabling the fireball catapults on the lead ship, Aang is trapped against a catapult with chains thrown by an attacker. Appa appears out of nowhere, grabs the attacker, and throws him overboard. Just then the ship is encased in ice by approaching waterbenders. Aang leaps aboard Appa to head to the next ship, but is shocked to find what looks like a thousand Fire Nation ships in the horizon.
Meanwhile, Chief Arnook addresses the recruits for the mission revealing they will be infiltrating the Navy disguised as Fire Nation soldiers. Sokka inadvertently laughs upon seeing the Fire Nation uniform they are to wear. After demonstrating his knowledge of the Fire Nation military, Sokka is told to brief Han (the warrior modeling the antiquated Fire Nation uniform) on all Fire Nation information to be used for the mission. Chief Arnook also instructs Han to show Sokka respect, as he expects nothing less from his future son-in-law. Shocked, Sokka manages an insincere "congratulations" to Han.
As night approaches, Iroh advises Zhao to cease the attack as waterbenders draw strength from the Moon and it is almost full. Zhao states he is aware of the Moon issue and is working on a solution, but agrees to halt the attack until morning.
Returning from battle, Aang is exhausted and frustrated stating he was only able to take out about a dozen ships. Aang begins to doubt his ability to help the Water Tribe hold off the Fire Nation attack.
Deep in the hold of Zhao's ship, Zuko has removed his Fire Nation soldier uniform and is preparing for his solo journey into the Water Tribe city to capture the Avatar. Iroh expresses his concern for Zuko saying that he only nags Zuko because, since the loss of his own son, he sees Zuko like his own. Zuko acknowledges his uncle's statement and says he will meet Iroh again "after – I have the Avatar".
Back in the Water Tribe warrior barracks, Han arrogantly informs Sokka about the perks of marrying Yue, which only serves to anger Sokka. Not fully comprehending his insensitivity toward Yue, Han then insults Sokka by insinuating Sokka lacks the ability to understand their tribe's way of doing things. Sokka lunges at Han calling him a "jerk, without a soul". The fight continues until Chief Arnook breaks it up and tells Sokka he is off the mission.
Zuko maneuvers his kayak to the shores of the ice cap just next to the base of the Water Tribe outer wall and observes what looks like turtle-seals diving into an opening in the ice. Knowing the creatures must come up for air somewhere; Zuko takes a deep breath and dives in.
While looking at the nearly full moon, Yue tells Aang & Katara about the legend of the Moon teaching waterbending to the water tribe people by observing the push and pull on the ocean by the Moon. Suddenly Aang realizes that maybe the spirits can help him on his quest to save the Water Tribe. Yue says she may know of a place where Aang can reach the spirits. She takes them to the most spiritual place in the entire North Pole. Aang is ecstatic to see grass again and Katara is amazed at how warm it is there. Aang begins to meditate at the base of the oasis pool containing two Koi fish – one black, one white – swimming in a circle.
Zuko manages to find where the turtle-seals come up for air - an underground cave. He uses his breath of fire to ward off the effects of his icy swim – yelling at the creatures to "Be quiet". Zuko then works his way up an opening with water rushing through.
As Sokka sharpens his boomerang, Chief Arnook approaches him for a special task – guarding his daughter, Princess Yue. Sokka humbly agrees.
Zuko ascends to an air pocket in the freezing water and catches his breath. He then spots another passage up under the water and heads through, but is met with an ice barrier. Using his firebending, Zuko melts the ice and breaks through, resting briefly– he has made it into the Water Tribe city.
As Aang tries to get into the Spirit World through meditation, Katara and Yue's conversation distracts him, but after he shouts "How 'bout some quiet!" they comply. Aang then focuses on the Koi fish and finally enters the spirit world. Yue asks Katara if they should get some help, but Katara says she can protect Aang. At that moment Zuko says "Well, aren't you a big girl now". Yue leaves to get help as Katara and Zuko fight it out. Zuko realizes Katara's skill level has greatly advanced from earlier encounters and he is eventually encased in ice similar to what Katara did to Pupil Sangook at the beginning of the episode. However, as the sun rises, Zuko manages to melt his way out of Katara's trap and knock her out by forcing her against a tree with a fire blast. "You rise with the Moon, I rise with the Sun", he says.
Fire Nation ships break through the Water Tribe outer wall and rush in to attack. Back on his command ship, Zhao states the city will fall today despite any efforts to fight off the inevitable.
Katara regains consciousness to find Aang is gone. Sokka and Yue approach on Appa and Katara tells them Zuko has Aang. The camera pans up to show a path going up the side of the polar ice cap surrounding the city. Finally, it is shown that Zuko is carrying Aang through a blizzard across the ice cap and the camera pans up showing snow falling from an ominous cloud filled sky.