"It girl" Serena van der Woodsen has returned to Manhattan after a mysterious and self-imposed exile to boarding school. Serena's best friend, Blair Waldorf, has conflicted feelings about her friend's return since she has enjoyed being the Queen Bee during Serena's absence and might not be ready to relinquish her new position on the social ladder, not to mention the fact that she has always suspected there may be unspoken feelings between Serena and her longtime boyfriend, Nate.

It's the day right after the Kiss on the Lips party and Serena receives a cold reception from her former best friend Blair. Blair reveals that she knows that Serena and Nate slept together, before Serena mysteriously went to boarding school. Then Serena decides to take Dan to Chuck's fundraiser brunch at The Palace. Meanwhile little Jenny asks Blair for advice, and Blair realizes that she maybe gains something by allowing Jenny into her inner circle.

It's Ivy week for the Upper East Side teens of Constance Billiard and St. Jude's and the visiting representatives' arrival brings more than just college applications. Cut-throat rivalry is at its sharpest this week as the students compete for prestigious positions. Blair discovers a shocking but juicy secret about Serena and plots to drop the bomb at the best possible moment. Dan is sure that landing the coveted usher position with the Dartmouth rep will either make or break his future at the school. Unfortunately, it's Nate who nabs the position, despite total disinterest in the school. Meanwhile, Jenny gets closer to Serena's younger brother Eric and Rufus asks Lily for a favor.