A medium, Grandma Goldy, is conducting a séance for a couple, a believing wife, Cynthia, and a skeptical husband. A wind blows through the window as "Uncle Danny" arrives, and the medium has them place their hands on an Ouija board. The planchette moves but the husband insists that the medium is doing it. The spirit then knocks twice to signify its existence, and the medium relates of how Uncle Danny is with his beloved pet. The husband, convinced, asks Goldy to find out where Uncle Danny hid some important papers. The fire in the fireplace expands, the temperature drops, and the planchette rises up into the air... and impales Goldy in the throat, killing her.
Dean is on his own after a week and a half and getting something to eat in Raleigh. He steals a car and hears a newscast about the death of two psychics in Lily Dale, New York, the "most psychic town in America." Dean drives there and poses as a FBI agent to check out the scene of the most recent death. He confirms that the medium used mechanical devices to create her "spirits."
Once he's done checking out the death scene, Dean goes to a nearby restaurant. He's disgusted to see that it's a spiritual/health-type place and starts to leave, but then sees Sam there. He sits down with his brother and tells him what he's discovered, and says that neither one of them is going to leave town without solving the murder, so they might as well work together. Sam reluctantly agrees and they notice a nearby woman noticing them. They hastily explain that they just happen to look like the infamous Winchester brothers, and the woman admits that she's relieved. Her husband Nikolai Lishin comes over and figures that they're FBI agents, and invites them to come to his spoon-bending demonstration later.
The brothers go over the two deaths. The first woman, Imelda Gravin, was beaten to death with her own crystal ball. Imelda had a necklace and Goldy inherited it, and was wearing it when she died. As Sam pours some coffee, his spoon bends on its own. They go to see Melanie Golden, the dead woman's granddaughter. She's saying goodbye to an attractive woman, Cynthia Thibadeaux, and invites the brothers in after explaining that she just got back into town after working the circuit. Dean points out that she doesn't seem to have any psychic props, and Melanie says that she reads body language and identifies what both of them are feeling. However, she doesn't believe in supernatural abilities. However, Dean admits that he has an open mind.
Melanie sends them to the Emporium where Granny Golden's possessions ended up, including the necklace. The owner, Jimmy Tomorrow, is reluctant to hand over the necklace. When they claim that it's evidence, he demonstrates his own abilities and says that Sam is feeling a great loss. Sam hesitates and Jimmy invites him to come back for a private reading. Outside, the brothers confirm that the necklace is made in Taiwan and realize that whatever killed the mediums is still out there.
Nikolai is at his room going over a pile of silverware when they begin shaking and the temperature in the room drops. All of the knives and forks stand straight up, and Nikolai is lifted into the air and then dropped onto them to die a gruesome death by impalement.
Later, Sam and Dean arrive to check out the most recent death. They talk to the police chief, who explains that every psychic in town has called him with their theory. The chief has confirmed that Nikolai had a vision of his own death. As they're talking with the chief, Melanie calls Dean and invites the brothers back to her home. When they arrive, Melanie explains that her grandmother had a vision of her death, including a temperature drop. Dean tells her that ghosts really do exist and Sam admits that they're not really FBI agents. As they go, the brothers try to figure how the spirit can move all over town, and Sam suggests that the quartz in all of the crystal balls allow the spirit to jump from place to place. Sam insists that they split up to canvass the town and quickly leaves.
Camille is meeting with a client and trying to reassure her while tossing the bones. Once she collects her fee, Camille has a vision of her clock showing 2 o'clock and someone breaking her neck. Dean and Melanie arrive and Camille tells them that she had a vision. Dean notices that Camille has a surveillance camera mounted and they examine the tape and see a ghost approach Camille and touch her head. He explains that the spirit is giving people their visions and Melanie says that she's seen the woman in a photo at an old museum.
Dean and Sam go to the Museum of Curiosities where the curator is giving a tour. The brothers look around and notice a photo of a pair of psychic brothers, the Campbells. The curator approaches them and explains that the Campbells were actually a couple, not brothers. Sam is more interested in a photo of the Fox Sisters. The curator explains that Kate Fox was disturbed but had a true gift, and her older sister Margaret looked after Kate. The Fox sisters lived in Lily Dale, died there, and are buried there. As Sam goes, the curator grabs Dean and asks if he knows an Eleanor or an Ellen. Dean doesn't respond, but the curator says that Ellen wants Dean to tell someone how bad it really is and trust someone, or she'll kick his ass from beyond.
Outside, Sam suggest that they should dig up Kate and burn the bones. Dean says that enough is enough and Sam has to drop the act and talk things out. Sam wants nothing to do with it, saying that Dean killed his friend. Dean says that Amy was a monster who had killed four people, and that he did what Sam couldn't do. He insists that he would have told him once he was sure that Sam was over his hallucinations of Lucifer, and then walks away.
That night, Sam digs up Kate's coffin and wonders why she's warning her victims first. As they salt and burn the bones, Kate's spirit appears and shoves Sam to the ground. She angrily asks why nobody is listening to her, but Sam burns the bones before she can attack his brother. They call Melanie and give her the news, and she passes the information onto her friend Camille. However, as they go home and Camille packs, the clock strikes 2 and everything from her vision comes true. They call Sam and Dean, and Sam tells her to get to the kitchen to get some salt. The spirit appears and starts choking Camille, and Melanie throws the salt at her, dissipating her momentarily. However, when Melanie runs out of salt, the spirit shoves a wardrobe on her, trapping her, and then kills Camille.
The brothers arrive at Melanie's house and she runs into Dean's arms. They realize that Margaret is responsible and that Kate was trying to warn them. Melanie explains that she was just in the way and that Margaret was focused on Camille, and was smiling the entire time as if she enjoyed killing. The brothers go back to the cemetery to dig up Margaret's bones, but discover that the coffin is empty. Sam figures that someone took the bones and is using them for a binding spell to harness Margret's powers. As they go back to the car, Dean notices a poster for the festival and points out that all of the headliners are now dead. They talk to Melanie, who confirms that the townspeople asked Camille to take Nikolai's place after he died. She explains that all of the dead psychics were doing well and Dean asks who would be the next person to fill in. Melanie says that they would probably choose her next.
Sam goes back to see Jimmy Tomorrow and asks if someone bought the ashwood altar necessary for a binding ritual from him. The store owner provides a credit card address and offers his condolences for Camille's death. Meanwhile, Dean sets up a spirit ward to protect Melanie, and she wonders if burning the ghosts' bones hurts them. When Dean says that it might, Melanie is satisfied.
When Sam runs down the address, he discovers that the house is being used for a Lamaze class. He figures that Jimmy is the necromancer and sent him on a wild goose chase. He calls Dean to tell him what's going on, just as Margaret's spirit appears at the window. Sam goes to the shop and discovers that it's closed, but finds Jimmy's apartment in the back. He slips in and finds the altar, and Margaret's bones on top of them. Jimmy gets behind him and captures him at gunpoint, but Sam quickly disarms him.
At the house, Margaret's spirit shatters the windows and summons a wind to blow apart the salt line. She appears and shoves Dean away, and advances on Melanie.
At the apartment, Jimmy explains that when he shows people what he can do, it scares them and he's unable to make any money. He then disarms Sam with his telekinesis.
Dean tries to hold Margaret off, using shotgun salt and iron chains.
Sam realizes that Jimmy has the rest of the bones in his bedroom, in his bed. He shoots the man, grabs Margaret's skull from the altar, and goes into the bedroom. As Margaret chokes Melanie, Sam salts and burns her bones, causing the spirit to disappear.
The next day, Dean and Sam go back to the diner for breakfast. Melanie comes in and Sam steps out to let Dean talk to her alone. She thanks him for saving her life and notes that he and Sam seem to be doing better. Melanie also figures that Dean doesn't want to come back to Lily Dale and says goodbye, but he figures that anything is possible. Dean then goes outside and discovers that Sam is putting his items in Dean's car. Sam admits that Dean was right about Amy, but tells his brother that he has to be honest with him. Dean says that he went with his gut and that he's been having trouble trusting anyone since Castiel. As far as his drinking since then, Dean admits that it's in large part because he had to lie to Sam.