Bad-boy Ryan Atwood finds himself in trouble with the law and in trouble at home. Against all odds, pro-bono public defender, Sandy Cohen, takes Ryan under his wing and back to his home in Newport Beach, Orange County, California. Ryan finds himself immersed in this high-class society but soon realises nothing is as it seems.

Afraid he'll be sent to another foster home, Ryan ponders running away from the Cohen's. Supporting his new friend, Seth helps Ryan hide in one of Kirsten's unfinished housing developments, but trouble may lay ahead if Luke and his friends find out Marissa is there too.

After Ryan's arrest for the fire, Sandy works his legal magic once again. The two search for Ryan's mother, who surfaces apparently sober and ready to accept her son back into her life. In an attempt to improve everyone's chances for a better future, Kirsten invites Dawn Atwood to a charity casino night. However, Dawn's alcoholic demons resurface and she makes a drunken scene in front of the entire party.

Sandy and Kirsten legally adopt Ryan. The newest member of the Cohen clan ends up escorting Marissa to Cotillion, where Seth meets up with Anna Stern, a new student from Pittsburgh. At the festivities, Jimmy's clients discover that he has been stealing their money and a fist fight breaks out.

Hoping to become financially independent, Ryan gets a job at the Crab Shack. At the restaurant, he meets Donnie. When Donnie invites Ryan and Seth to a party in the old neighbourhood, Ryan is reluctant to reconnect with his past, while Seth is anxious to find out more about this alternative, anti-Newport lifestyle. Moreover, Ryan finally finds the confidence to ask out Marissa.

Kirsten's father, Caleb, arrives to celebrate his birthday party. He brings his new, young, attractive girlfriend, Gabrielle. After Caleb criticises Kirsten's judgment, party and family business, Sandy tries to encourage his wife to leave the real estate business run by her father. Next door, Julie tells Jimmy that she is filing for divorce and, at the party Caleb turns his pleas for a job down.