Reverend Alden falls ill while collecting donations for a struggling town. He is taken in by an ex convict named Caleb Hodgekiss and his wife. Caleb helps the Reverend by traveling to Walnut Grove and encourages everyone to donate money. He earns the community's trust with his sensitive and caring personality, but because of his dark past, it's hard to tell what he might do.

Nellie's physical abuse toward Bunny leads to a dangerous riding accident, but as the little girl lies in bed with a concussion and possible paralysis, her distraught mother blames Laura and orders Nels to shoot the animal. Laura secretly takes Bunny home until she can figure out a plan, but her problems run even deeper when she begins to believe that she is responsible for Nellie's condition.

Laura’s beloved horse Bunny has officially been returned to her. She eagerly prepares to enter a local race. Jealous, Nellie throws a tantrum until Harriet agrees to buy her a thoroughbred without Nels' approval. Although Nellie and her horse are expected to win the race, Laura perseveres with her training. The stakes are higher than ever when Harriet donates a lavish prize for the winner.

Frustrated that Carrie has insisted on tagging along for a school assignment, Mary and Laura fail to keep a close eye on her. They live to regret this when the little girl wanders off and falls into an underground mine shaft. Despite the frantic efforts of everyone in town, the only person who can really help is the knowledgeable Mr. Laudy, an alcoholic ex-miner who now has a shot at redemption.

On Halloween night, Laura and Mary get permission from their parents to walk into town and pull off a little prank at the mercantile. Laura's imagination runs wild when she peeks into the Olesons' window and witnesses Nels committing an unspeakable crime. Scarred by what she has seen, Laura can't seem to get anyone to believe her.

In the wake of his mother's death, a devastated Charles travels home with the intention of bringing his father back to Walnut Grove. Lansford Ingalls would rather commit suicide than continue his life with anyone. Meanwhile, with Thanksgiving approaching, Mary and Laura aren't quite sure how to tell Carrie the truth about the turkey they just purchased.