A new history teacher arrives, Alaric Saltzman, to replace Mr. Tanner. Jeremy notices his ring, which resembles the one worn by vampires. Jeremy introduces his new teacher to Jenna, who then becomes infatuated with Alaric. Alaric asks Jenna to invite him into her home, but she refuses after realizing Jeremy is there. When Bonnie is having dreams about her ancestor Emily, the girls decide to hold a seance, enabling Emily to possess Bonnie. The reason why Damon really came back to Mystic Falls is revealed: Katherine and all the other vampires whom were thought to be burned in the church are sealed underground in Mystic Falls, and Damon is trying to use the crystal to resurrect them and exact revenge upon the humans. Emily destroys the crystal and thwarts Damon's plan. The furious Damon attacks Bonnie, but Stefan saves her by making her drink his blood. Bonnie is frightened of Stefan until Elena reveals everything to her. Matt continues to be there for Caroline when she needs it. Logan returns into the picture as a vampire instead of a corpse.
An old vampire friend of Stefan's arrives in Mystic Falls, the 350-year-old Lexi. She makes Elena realize the value of love, and helps her to take the first step towards renewing a relationship with Stefan. Jeremy stops doing drugs and putting off homework after Damon alters his memory of Vicki's death. Elena ask Damon if there's anything else that he did to her brother and Damon said he just removed the suffering. Damon gives a box of vervain to Sheriff Forbes and she reveals to him all of the vampire hunters in town. Damon frames Lexi for the death of a local boy by altering his girlfriend's memory and changing her testimony. The police apprehend Lexi. Outside the bar, Damon stakes Lexi and kills her before she can attack the sheriff. Furious at him, Stefan attacks Damon, but stops short of killing him. He spares Damon's life to repay Damon for saving him from Logan.
Stefan tries to help Vicki deal with her urge to feed, but is unable to control her. At a Halloween party, she attacks Jeremy and Elena, and Stefan stakes her through the heart, killing her. Stefan swears Elena to secrecy so she won't tell Matt and Jeremy what really happened to Vicki. Elena is unable to console the grieving Jeremy and asks Stefan to use his powers to make sure her brother does not remember what happened. When Stefan tells her he is unsure of it working effectively, Damon volunteers to "take away his suffering."
Stefan explains his and Damon's past with Katherine to Elena. In 1864, they both loved Katherine, who then turned them into vampires. Meanwhile, Damon spends the day trapped inside the Salvatore house with Vicki. They feed off of each other and he changes her into a vampire. Stefan discovers this and attempts to persuade her to die instead of completing the transformation into a vampire by feeding on human blood. Logan uses the pocketwatch that tracks down vampires and finds Stefan and Vicki in the woods. Logan shoots Stefan with a wooden bullet, thinking Stefan was attacking Vicki. Damon saves Stefan by attacking Logan. Vicki is overcome by the hunger and feeds on Logan, completing her transformation. Stefan tells Elena Vicki has become a vampire, and Elena decides to keep his secrets, but not without ending their relationship.
Damon is still locked up and is growing weaker. Jeremy and Vicki have gotten back together. The school is organizing a car wash to raise funds after Mr. Tanner's death. Elena and Stefan have been having some trust issues but they soon work them out. Elena hears a shocking story about Stefan and Damon from a stranger who recognizes Stefan; it was about an attack that happened almost 50 years ago. Elena does some research and finds a video with a news report about the attack. In the video she can clearly see Stefan, who looks exactly like he does now. While still locked up, Damon uses his powers to get Caroline to let him out, killing Zach after being released. Damon ends up escaping the prison, but Stefan has taken his ring, so he cannot leave the house when the sun is out. During the night, Damon leaves the house and attacks Vicki when she is out in the woods with friends. Logan and Aunt Jenna start to rekindle their relationship. Logan uses his time with Jenna to sneak into Jeremy's room and stealthe pocketwatch. At the car wash, Bonnie starts a fire using her powers. She is horrified and confused so she goes to her grandmother for help. Elena confronts Stefan about who he really is.
Elena and Stefan go to the town's annual Founders Party, hosted by Tyler's parents. Vicki wants Tyler to take her to the party. Damon tells Elena about the history of the Salvatores after Stefan tries to cut Damon out of his life. Meanwhile, Stefan uses Caroline as a vessel to poison Damon. When Damon sucks Caroline's blood, he falls ill. Stefan locks up a weakened Damon at the Salvatore property. Tyler's parents, Sheriff Forbes (Caroline's mom), and Logan have come to the conclusion that vampires have returned to Mystic Falls due to the drained bodies, and must retrieve a pocketwatch that belongs to the Gilbert family.
Bonnie has a bad feeling about Stefan so Elena decides to invite Stefan and Bonnie to dinner to get to know each other better. At school, Tyler attempts to humiliate Stefan by throwing a football at him, but it backfires as Stefan effortlessly catches it and passes it back. Stefan ends up joining the football team. During dinner, Damon and Caroline unexpectedly show up, and Elena "invites" him into her house. Stefan attempts to convince Damon he still has some humanity left in him, but Damon attacks and kills Mr. Tanner as a rebuttal.
Mystic Falls begins the preparations to celebrate the passing of a comet. While Vicki recuperates in the hospital from her injuries caused by a vampire, Stefan uses his abilities to erase Vicki's attacker from her memory, but is interrupted by Matt. Mr. Tanner warns Jenna about Jeremy and that tells her that she is doing a bad job of taking care of teenagers. Elena and Damon meet for the first time at the Salvatore house and his revelation on Stefan's past brings Elena closer to the truth. Damon finds his next victim in Caroline.
Elena Gilbert and her brother Jeremy come to terms with the deaths of their parents. Elena likes to visit the cemetery where her parents are buried to write in her journal. When she is there she runs into Stefan, the new guy at school. Jeremy treads on a dangerous path of using drugs to ease his pain. The school is having a back to school party that everyone is attending. While walking in the woods, Vicki is attacked by Damon and her body is found by Jeremy and Elena. Stefan soon realizes that this was done by his brother. When he returns to the boarding house, he and Damon see each other for the first time in over 10 years.