With the Great Dragon free, Camelot falls victim to vengeful attacks. Arthur and his men patrol the city while Gaius and Gwen take care of the injured. Gwen worries that the attacks are too powerful even for Arthur to overcome, but Gaius asks her to have faith. As Arthur and his men take their posts armed with flaming crossbows, Merlin apologises. Arthur rejects it, and as the Dragon flies over the city, he gives the order to fire. As they do, the Dragon showers them with flames.
Realising that there is no clean water remaining in the treatment zone, Gwen ventures outside to fetch more. As she does so, Gwen puts herself directly in the Dragon's firing line. Arthur rushes to save her but as they both run for cover, Arthur is struck down by the Dragon. Merlin ignites a spear and hurls it at the Dragon, only to see it simply bounce off. The Dragon taunts Merlin and flies away without giving him a reason for the attacks. Tending to Arthur's wound, Gwen tells him that he shouldn't have risked his life. Arthur replies that he wasn't going to let anything happen to her and holds her hand to his heart, Gaius smiling on. Merlin returns unharmed but quite defeated.
The following morning, Arthur relays the level of destruction caused to Uther. Gaius says that a Dragonlord can end the attacks, and one named Balinor may still be alive. Arthur offers to find Balinor on his own despite Uther's protests and departs with Merlin. According to Gaius, the Dragonlords were men who could tame the Dragons. Uther believed their art was too close to magic and therefore had them slaughtered. Gaius reveals to Merlin that Balinor is in fact his father, and that Gaius had helped him escape death all those years before. Overcome, Merlin sets off with Arthur after receiving advice from Gaius to keep the secret.
Reaching the last known whereabouts of Balinor, Arthur and Merlin discover that Balinor lives in isolation. As they set out to find the cave, Arthur succumbs to his injury and passes out, leaving Merlin to lead the way. Eventually, he finds Balinor and asks for his help. While Arthur sleeps, Merlin tries to learn more about his father and get him to join them in Camelot. Balinor, still unaware he has a son, refuses to help Camelot because of what he suffered at the hands of Uther. When he awakes the next morning, Arthur is amazed at his recovery and also learns of Balinor's refusal of help. As Camelot continues to crumble, Gaius comforts Gwen. He assures her Morgana is alright wherever she is and reveals that he has noticed the mutual feelings between herself and Arthur. Gaius tells Gwen to never underestimate the power of love, re-instilling hope that the two can be together.
With Arthur's last-ditch effort to gain Balinor's help failed, the two prepare to leave. Merlin mentions Gaius' name, whom which Balinor states is a good man. Arthur's constant calls for Merlin prevents him from telling Balinor the truth, and so Merlin leaves. In the forest, Arthur and Merlin trade playful insults until they are alerted to a noise. It turns out to be Balinor, who has decided to join them in the fight. Alone, Merlin is finally able to reveal the truth. As they prepare to return to Camelot, Balinor dies protecting his son. He imparts words of wisdom to Merlin and says that his son would make him proud. Devastated, Merlin continues with Arthur on their journey and eventually return to Camelot safe. Resigned to the fact that the last Dragonlord is dead, Arthur tells his father that he and his knights will fight the Dragon on their own. Alone, Merlin mourns the death of Balinor. He tells Gaius what had happened in the forest and of what his father had told him. Gaius reveals that Merlin has inherited the power of the Dragonlord, and time will tell if he is strong enough to harness it.
As he prepares Arthur for war, Merlin asks Arthur to be careful in battle. After being told he is joining Arthur in the fight, Arthur tries to dissuade Merlin. Merlin playfully asks Arthur if he knew how many times he's had to save his life, only to prompt Arthur to believe Merlin's regained his sense of humour. Arthur and Merlin lead the knights out of the castle towards the final battle. The Dragon swiftly dispatches the knights, leaving Arthur and Merlin to face him on their own. Armed with a spear, Arthur survives a fireball and stabs the Dragon. Enraged, the Dragon recoils and sends Arthur to the ground, unconscious. Merlin, hearing the words of his father, harnesses enough power to communicate with the Dragon; sparing his life, but warning him to never return. The Dragon flies away, promising to never forget his clemency. When Arthur comes to, Merlin tells him that he killed the Dragon, causing Arthur to laugh out of relief.
The fight over, Arthur and Merlin return to the castle. Gwen runs into Arthur's arms, relieved to not have lost him and as they hug, Gaius expresses to Merlin his pride. As Arthur and Gwen leave, a triumphant Gaius and Merlin walk back inside.