At Caritas, Angel apologizes to Merl for his cruel behavior. He goes as far as to suggest that Merl try to hit him, but the "no demon violence" spell on the bar sends Merl flying back. Merl returns home, where he is ambushed and killed.
When Angel learns that Merl has been killed, Angel Investigations meets at Merl's to investigate his murder. Gunn is reluctant to waste time looking into the murder of a demon, and after a heated debate with Angel, Gunn chooses not to help with this case. He returns to his old gang's hideout, where he is met with hostility. A newcomer, Gio, questions why Gunn is working with a vampire, and Gunn learns from Rondell that the rest of the gang feels that Gunn has turned on them.
At the Hyperion Hotel, Angel asks Cordelia to try to bring Fred out of her shell. Angel and Wesley investigate a bookie friend of Merl's only to find the demon murdered similarly to Merl's death. A meek, nonviolent species of demon walks through the sewers alone, but is attacked and killed, one of his killers being Gio. Gunn shows up at the bookie's apartment in response to Wesley's call for assistance. He doesn't like the idea of investigating demon deaths, thinking the murders aren't all that bad. Wesley explains that the murders are committed without any consideration of the differences between good and bad demons. Gunn pockets the arrow from a crossbow bolt used to kill one of the demons then is off to search for information.
Gunn returns to his former gang and questions Rondell only to find that Gio isn't acting alone in the murders; the whole crew is involved. Back at the hotel, the source of their problems is questioned, as is the missing evidence Gunn took. At Angel's encouragement, Cordelia goes outside to talk to Fred, but has a hard time getting a conversation started. She suggests that the both of them get out on the town and live a little. Gunn returns to the hotel and talks with Angel about the progress of their investigation, then announces he needs to talk to Wesley.
Cordelia has taken Fred to Caritas, and Fred sings "Crazy" on stage. Gunn and Wesley are also there and as Fred sings, a demon crossing in front of her is shot dead. Gunn hides the Host behind the bar as those who used to be his friends start randomly killing demons in Caritas. Cordelia hides behind a table while Wesley rushes to the aid of Fred to move her to safety. The gang of shooters starts to leave, but Gio suggests they stay. Gio informs Rondell about all of Gunn's associations with demons, creating hostility between the two.
Everyone else figures out that Rondell and the rest of the crew were responsible for all the other murders as well. Gunn stands in the way of the Host getting shot while debating with Rondell over which of them has the more righteous mission. Trying to protect his friends, Gunn offers the keys to his truck and tells them all to leave. Cordelia tries to guide Fred out the door, but she is the only one allowed freedom and that is only until she returns with Angel. Cordelia finds Angel and he directs her to three Furies who can lift the "no demon fighting" spell on Caritas.
At the bar, Gio amuses himself by singing along with the karaoke machine -- mocking Gunn with the lyrics "Did you ever know you were my hero?" from Wind Beneath My Wings -- unknowingly allowing the Host to psychically learn personal information about Gio's activities in Miami, referring to a 'she' who Gio somehow let down during his time there (In the original script, the Host elaborates, saying "I know why you left. Why you ran. You couldn't stay there after that, could you?...She wasn't a demon, was she?...She was just a sweet, human girl, practically a child...Right up until the end, she trusted you. Did you know that?" implying Gio killed a girl he mistakenly believed was a demon, and that this is why he fled Miami.). An escaping demon, from a demon race renowned as baby-eaters, distracts Gio and he has his weapon stolen by Gunn. The taunting verbal game starts again as Gio accuses Gunn of protecting a baby killer and wanting to be a demon. Gio talks about Gunn's sister, claiming that Gunn let Alonna be turned because he wanted to become a vampire himself, staking her only when she refused to turn him herself, leading Gunn to snap and kill the baby-eating demon with a gunshot, mere moments before Angel arrives.
Gunn is given the opportunity to kill Angel and doesn't, but denies that they are friends; he simply states that Rondell has lost the mission, but Angel retains his. Gio makes it clear that no one leaves until Angel is dead and asks for volunteers to do the job. Fred claims that she doesn't want to die, so she offers to do it and takes the crossbow from Gio, only to point it at Gio's neck. Cordelia tries to persuade the Furies to lift the spell, but the three are very much obsessed with the dark vampire. Cordelia needs them to rush and finds that there is a debt to be paid for this favor and only Angel is "equipped" to do it.
Finally, the spell is lifted from the bar and Angel can fight. The gang escape to safety while Angel takes care of the fighting. Gio has his head bitten off by a demon and more are killed before the fight is ended. Outside, after talking to Rondell, Gunn comments that Rondell and the crew will likely stick to their own area from now on. Wesley understands the difficulty of Gunn's situation but firmly tells him if he ever jeopardizes their work again, he'll be fired without hesitation.
Angel exits the club and Gunn tries to explain he was trying to stall when insulting Angel within the club. Angel knows he spoke the truth but he doesn't mind it. Gunn thinks he has proven his trustworthiness by not killing Angel, but Angel clarifies that "You'll prove that I can trust you when the day comes that you have to kill me - and you do."