While cramming for finals in the library, Phoebe befriends and enterprising young student named Charlene who is doing her thesis on the existence of demons in the corporeal world. After freaking Phoebe out, presumably because she gets enough demonic talk at home, Charlene is decapitated by a demon – Libris – whose charge it is to keep mere mortals from proving the existence of supernatural evil.
Meanwhile, Prue busts in on another romantic evening for Piper and Leo to show them something odd in some photographs she took earlier in the day while on assignment. The same sad looking man is in all the pictures. Her curiosity peaked, Prue tracks down the man to get the 411, but not before spying Leo's "nice orbs" in the shower. The long and the short of it is, whatever she saw she liked, so I'm going to go with the long.
Prue's mystery man is a grieving father whose daughter was murdered some 6 months before. On a crusade to find a witness to identify the man who everyone know did it – a sleazy pawn shop owner named Gibbs across the street – he passes out fliers all day long. No one is talking, apparently, because Gibbs is a major badass who has scared them into silence.
Phoebe goes back to library and learns that (a) Charlene has been decapitated and (b) that her ghost is not only still writing the thesis but has no idea that she is dead. Again, Phoebe gets freaked and flees the scene.
Meanwhile, (and yes I'm exhausted just thinking about all that happened) Piper walks into the club to find Leo and Dan duking it out in a match that will undoubtedly have more action in it than the Grant-Lewis title fight on Saturday night. Piper breaks it up, but neither spills the beans on why they are settling their differences with fisticuffs.
The girls convene, discuss, and regroup.
Phoebe is sent back to the library to convince Charlene she is a ghost and to enlist her to find the demon so that it may be vanquished. Prue does some investigative work and vows to catch Gibbs, one way or the other. Piper talks to Dan, who has discovered that Leo was not who he claimed to be, handing over Leo's army records. The records revealed some nice juicy morsels including the fact that Leo died (which Piper knew) and that he was previously married (which she did not know, thank you very much) to a woman who is very much alive.
Piper talks to the ex-wife and comes away satisfied that Leo was both a great person when he was alive, and that Leo's past in no way affects his love for her now.
The girls then go to the library with Charlene, who is now aware of her ghostly status and very pissed about it, to kill the demon and then, therefore, allow Charlene to go on. After some nifty witcheroo magicky stuff, the demon is killed, but Charlene does not move on. Prue then decides that Charlene must also help them catch Gibbs before she may ascend.
Charlene then haunts Gibbs at his pawnshop, posing as the girl he murdered, and extracts a confession for the cops. Gibbs goes to jail, the father gets closure, and Charlene ascends.
As if that weren't enough, the show closes with the Goo-Goo Dolls debuting their new song, "Broadway" in the club right before the end of the show.