On stardate 41463.9, the USS Enterprise is on a mission to catalog young planets in the Pleiades Cluster. Along the way, they have been instructed by the Federation to check on the terraforming colony on Velara III as they were behind schedule. Captain Picard calls down to the station and Director Kurt Mandl, responds. The Director insists there is no need for them to pay a visit as they are back on schedule. Counselor Troi senses he is extremely nervous about something, especially when Picard insists on an away team to be sent down to have a look around. Troi, Commander Riker, Lt. Yar, Lt. Commander Data and Lt. La Forge beam to the facility. They are greeted by Hydraulics Specialist Arthur Malencon, Biosphere Designer Luisa Kim, and Chief Engineer Bjorn Bensen. Outside the complex is Velara III's dark, windswept desert, a hostile place which Luisa tells them to remember; In a couple of decades, she plans for it to look like a garden of Eden. Luisa apologizes for their Director's rudeness. She points out that they don't get many visitors and mentions that Dr. Mandl has been under stress lately.
Luisa offers a look around, explaining their amazing procedure of taking a lifeless planet and converting it into a Class M environment. She explains the first phase is selecting the right kind of planet. It must have the proper mass and gravity, the correct rate of rotation, and a balanced day and night. It must also be completely lifeless. Once a candidate world is selected and approved by the Federation, the terraformers take over. They are now at Phase Two - digging basins and pumping filtered sub-surface water into them. Phase Three will be adding micro-organisms to create a lush, arable biosphere. Malencon points out that they have been having problems with the servos that control their hydraulic probes. Geordi offers assistance, wondering if the high saline content of the soil is disrupting conductivity. Mandl finally enters, appearing gruff and moody. He reminds Malencon of their tight schedule and sends the tech off to work. Mandl directs the away team's attention to a schematic diagram of their planning; everything is specific and exacting. Suddenly Troi senses terror and announces that Malencon is in trouble! A warning siren sounds and the group runs to the hydraulic station. As they approach, they hear the blasting of a drilling laser and cries of pain. The door to the room is sealed; they try to force the hatch when the laser blasts and screams abruptly stop. Upon opening the door, they find the room is a complete mess and spot the smoldering remains of Malencon; they are too late to save him. In the center of the room a large drilling laser hangs from a control arm, still pointing down at him.
Riker has Malencon's body transported to the ship. In the meantime, they have the power to the hydraulics room shut down. Luisa, Mandl, Troi and Riker head to the ship as well; the rest stay to survey the damage. Data finds it interesting that the laser seemed to stop at the moment Malencon stopped screaming. He reactivates power to the room and reruns the drilling program. Data watches the beam run its cycle as it blasts down into each of the bore holes. He turns away for a moment to check the readouts. Suddenly, the beam pivots toward him. He quickly dodges the stream as it blasts past him. It fires again, but he is saved by his android reflexes. Geordi and Benson come to the rescue, but find the door is sealed again. Beyond it, they hear a horrendous crash and the smashing of equipment. They finally get the hatch open, and find that Data has ripped the machine down from its mounting. The whole device lies mangled on the floor, and Bensen laments a year's work destroyed.
The away team returns and Picard is informed of the attack. He tells Mandl he is shutting down operations until the matter is investigated; Mandl is outraged, stating Picard is overstepping his authority. Picard says a member of his crew has been attacked, which gives him the right to intervene. Mandl reminds him that he has a delicate schedule to maintain, but Picard says it is on hold until he has answers. Picard meets with Geordi and Data, who inform him the drilling laser was somehow reprogrammed to kill anyone who enters the room. Picard suspects one of the three terraformers, and instructs Geordi and Data to return to the planet to look for any sabotage or tampering. He tells Yar to dig up the service records of the terraformers and look for a possible motive.
Data and Geordi return to the station. Data notices a strange flicker of light down at the far end of one of the bore shafts. He makes sure it isn't a reflection of light, and scans it with his tricorder. He gets no readings, so he asks Geordi to look at it with his VISOR. Using its various visual modes, Geordi scans the object. It's inorganic, yet the pulses of light and color are unexplainable. Data wonders if it could be alive; it might be what the terraformers are trying to cover up. The object is beamed to the Enterprise where Dr. Crusher has it placed inside a bell jar for analysis. The computer makes scans and verifies that it contains no organic molecules. Beverly enhances the scan on the wall display, which shows a complex pattern of crystalline forms. Energy patterns flow throughout a beautiful network of structures. It begins to emanate an audible hum. Beverly asks the computer what is causing the flashes and noise, but it is uncertain since it is theoretically impossible for the substance to produce such an effect. She asks for a hypothesis, to which it replies: "Life".
Picard relays the findings to Mandl and his staff. Mandl claims the Federation verified Velara III lifeless, which Picard says is understandable given the novel nature of the lifeform. Regardless, Picard mentions his suspicions of Mandl knowing there was life down there; a direct violation of the Prime Directive. Mandl makes it clear that he is in the business of creating life, not taking it! Back in medical, Beverly calls for Picard; Geordi has detected movement inside the crystal. Picard arrives and Geordi indicates he has detected a shift in the infrared spectrum; its internal structure is somehow changing. Suddenly, the small flicker of light brightens, nearly blinding everyone in the room. The hum grows louder as well. The hum and light subside, revealing two points of light inside the bell jar. Data points out that only life can replicate itself.
As a precaution, Beverly activates a containment field around the bell jar, but the computer has trouble maintaining the field. The computer indicates that a "translation request" is being made; the glowing objects are trying to communicate with the computer. Power is increased to the containment field but the fight for control continues. It looks as if Data is right; it's a life form, and also intelligent, with the power to access the computer. Everyone evacuates the lab and meets to discuss the situation. Once again, Picard confronts Mandl, asking if he knew there was life on Velara III. He admits he knew of random energy patterns that disrupted their drilling, but that hardly indicated life by anything he is aware of. He adds they're meaningless silicon crystals that rebroadcast sunlight. Picard tells him they are hardly meaningless; they are clearly alive and intelligent, and are trying to communicate.
By now, the bell jar contains a cluster of several points of light. Data works with the computer on the analysis. The computer relays its composition: silicon, germanium, gallium arsenide, cadmium selenide, water, sodium crystals...forming a natural superconductor array. Elsewhere, an engineer reports that the power fluctuations are increasing, causing numerous systems around the ship to go haywire; something is taking over. Soon, the universal translator comes online by itself, "Ugly bags of mostly water!" Picard is confused, and Data indicates it is an accurate description of human physiology; he points out that humans are 90% water surrounded by a flexible container. (This is actually incorrect; humans are about 60% water with variation by gender and body type. Also, bones and tissue are found throughout the body and do not form a flexible container with water inside) The crystals speak, saying they had asked the humans to leave, but they did not listen. It has driven them to kill. Picard tries to reassure the crystals that they come in peace; they didn't understand the message, and were unaware there was life on the planet. The crystals object, stating the "bags" at the station knew. They tried peaceful contact, but were ignored, and some were killed. They have no choice now but to declare war. Before Picard can respond, the crystals end communication. At this point the whole ship is jarred by a force.
Data indicates that the crystals have joined together into a kind of living computer he calls a "microbrain"; the more there are, the stronger they become. The flashes of light they emit appear to be program instructions, so they can interface with the ship's computers faster than the crew can. After a quick flare up of energy and more disturbances in the ship, the crystals seem to power down. Beverly indicates that with single-celled organic life, replication is followed by a resting state; perhaps it is the same for the microbrain. Picard orders Yar to beam the entity back to the planet. She tries to energize the beam, but power becomes redirected. Picard is agitated; lifeform or not, the safety of the ship is at stake. He tells Data to remove the atmosphere from the medical lab. Data tries, but again, the controls are locked out. Picard meets with the terraformers, explaining that the entity said it has tried to contact them before, but they ignored it. Mandl claims, if it tried communicating, they didn't understand it; how were they to know? Picard wants to know what the terraformers did to cause the crystals to fight back. Luisa indicates Malencon was siphoning off a layer of saline water on the surface of the sand. Beverly suggests that life needs water, perhaps it was sustaining them. Data suggests it might have been what linked them together; individually, a single brain cell is not intelligent, but when linked to others, intelligence is formidable. To prevent the loss of the saline, it drove them to kill.
The image of the medical lab shows the mass in the bell jar growing brighter. Suddenly, the bell jar shatters. Data and Geordi come up with an idea; they had detected cadmium salts, which create electrical current under infrared light. Perhaps the crystals are photoelectric in nature. Picard has them kill the lights in the medical lab. Riker opens an access panel at the room, and disables the lighting system. Now in total darkness, the glow of the microbrain begins to soften, and the crystals respond, begging for more light. Picard waits for them to relent control over the computer, then has the lights brought back up, just a bit, to relieve them of their torment. The microbrains state; "War over!" to which Picard agrees, and expresses his apologies for having caused them harm. He has the transporter chief beam the entity back to Velara III.
Afterward, Picard places an indefinite quarantine on the planet. Data is saddened that they couldn't learn more about the strange lifeform. Picard replies; "In time, Mr. Data. When we're better prepared." They set course to the nearest starbase to drop off the terraformers.