Diana feels pressured to sleep with her boyfriend Bobby, and undergoes a rite of passage afterwards. Meanwhile, Richard and the saucy Abby have a brief encounter.
The neighbors throw a barbecue for Laura to celebrate her new success as a realtor. At the party, Richard paws Abby and Laura overhears them planning to meet later.
Michael's continued hyperactive behaviour is a major source of concern for Karen and Sid. Abby becomes bookkeeper at Knots Landing Motors. Gary receives threats from Orchid Cab Co. and is ordered to pay them $50,000.
Val deals with the news that she has a malignant tumour in her colon and may need a colostomy far better than Gary does. Bobby arrives from Dallas to give Gary home truths.
Abby's ex-husband Jeff kidnaps their children Olivia and Brian. The Orchid Cab Co. come back to haunt Gary and Sid when the cut the brakes on Sid's car, which goes over a cliff.
Karen's former boyfriend, Teddy Becker, visits Knots Landing and believes he is Diana's real father. Val and Lilimae bond after bad memories resurface.
Laura believes that Richard is having an affair when he starts to go to client parties so she goes on a trip to Santa Barbara with Scooter out of spite.