Recapping the drama of the last episode, Naruto is almost eaten by a large snake but escapes using Shadow Replication, while a powerful Grass ninja attacks Sasuke and Sakura. The two narrowly escape as Sasuke stabs himself in the leg to break the fear spell. The two got away but was attacked by a giant snake. Sasuke kills it but the Grass ninja was inside the snake. He shows up and Sasuke sinks deeper and deeper into his fears. Soon, Naruto shows up to help.
Sasuke warns Naruto to run, but Naruto's not one to retreat - especially without a fight. Naruto is also slightly annoyed that the Grass ninja sent that huge snake to gobble him up previously. Sasuke, however, believes this ninja is well above their levels and they should run before they are killed. In a moment of clarity, he decides the only way to survive is to bargain with the Grass ninja - their scroll for their lives. Naruto thinks Sasuke has lost his mind at this point and catches the scroll in mid toss before the Grass ninja can catch it. Naruto then punches Sasuke angrily. Not only does he refuse to give up, but he accuses Sasuke of being a fake because the Sasuke he knows isn't such a coward. He mentions there's no guarantee that this guy will let them go even if they do given him the scroll. The Grass ninja agrees and says that he could just kill them to get the scroll. Naruto then rushes the Grass ninja, who uses a summoning jutsu to summon his snake.
Outside the Forest of Death, the sentinels from the first exam find three dead bodies. Their faces are gone as if they were melted off. The men immediately went to Anko to inform her. The sentinel arrives just as Anko is finishing her meal. Anko comes with the sentinel over to investigate. At the scene, they learn that the dead ninjas were Chunin Exam registrants from the Hidden Village of Grass. Anko has her suspicions that this might be the work of 'him' and immediately asks for the pictures of the applicants. Once she sees their true faces, she recognizes the one of them that handed her back her kunai right before the Forest of Death phase began. Now worried, Anko immediately sends the inspectors to inform Hokage-sama and requests for a mobilization of at least two ANBU squads to the Forest of Death. She's going in after these guys.
Inside, the Grass ninja charges Naruto. During the exchange, some of Naruto's Nine-Tailed Demon Fox chakra is unleashed and he lets loose on the snake. The Grass ninja counters to give him enough time to attack Sasuke. Fortunately, Naruto is able to stop the snake just in time. Sasuke remains almost paralyzed, but after a few taunts from Naruto, he remembers a similar situation where he saved Naruto. Naruto again repeats that this can't be the Sasuke he knows.
As Naruto tries to snap Sasuke out of his daze, the Grass ninja picks up Naruto with his tongue and seals his Nine-Tailed Demon Fox spirit using Gogyo Fuuin (Five Element Seal). Sakura screams to Sasuke to help Naruto, who transforms back to his original self and is now unconscious. The Grass ninja then takes Naruto's scroll and tosses him away. Sakura throws a kunai to prevent Naruto from falling and then again screams at Sasuke, who is still paralyzed by fear, to join this battle.
Sasuke is still trapped in his thoughts. He envisions his brother taunting him - to hate him… to run away. Finally, he is able to snap out of it and prepares to fight.