- Agent Cooper enjoys the comforts of the Great Northern Hotel. Bobby Briggs and Mike Nelson are released from jail. Doctor Hayward hands over the autopsy report on Laura Palmer.
- Two days after Laura Palmer's death in the supposedly sleepy town of Twin Peaks.
FBI Special Agent Dale Cooper (Kyle MacLachlan) is met at the motel restaurant by Audrey Horne (Sherilyn Fenn) while having "a damn fine cup of coffee". Audrey says that she didn't use to appreciate much Laura, but she used to be kind to her Johnny (Robert Davenport), her emotionally-damaged brother. Post-mortem shows that Laura Palmer (Sheryl Lee) had had sex with three different men.
Leo Johnson (Eric DaRe) treats Shelly (Mädchen Amick) as if she were his slave. Norma Jennings (Peggy Lipton), a co-worker at the Double R coffee bar picks Shelly up to work. Shelly realises that one of Leo's shirts is blood-stained and she puts it in a drawer instead of washing it with the rest of the laundry. James Hurley (James Marshall) was the freak who was secretly going out with the home queen Laura, who didn't want to split up with Bobby Briggs (Dana Ashbrook), the successful football player. She had started doing cocaine again some days before her death. Donna is in love with James, who remembers how Laura gave him half of her golden heart because she could believe that he was really love with her. Cooper frees James - in custody of his uncle Big Ed Hurley (Everett McGill), Bobby and Mike Nelson (Gary Hershberger).
Jocelyn Packard (Joan Chen) thanks Pete Martell (Jack Nance) for supporting her in front of his bitchy wife, ambitious Katherine Martell (Piper Laurie), who wants to rein in the sawmill. Jocelyn is also questioned. Jocelyn has inherited the sawmill from her late husband Andrew, but her sister-in-law only cares about money. Katherine talks to her lover about her plans to get control over the Packard sawmill.
Sarah (Grace Zabriskie) is still in shock over the death of Laura when Donna Hayward (Lara Flynn Boyle) goes to speak with her. First, Sarah thinks that Donna is Laura and hugs her. Then, she sees a man who stares at her and she screams hysterically. We don't know whether Ed's affirmation that his beer has been drugged has anything to do with that or no.
A one-armed (Al Strobel) man leaves the hospital. Benjamin Horne (Richard Beymer) tells Audrey Horne off as she has damaged irreparably the real estate deal the Hornes had taken so long to prepare. At the RR, Shelley talks to Cooper and Harry S. Truman (Michael Ontkean). At the RR, the Log Lady (Catherine E. Coulson) approaches them to say that the log saw something the night of Laura Palmer's death, and that Cooper should interrogate it.
Leo hits Shelly while asking where his favorite blue shirt was. Bobby's father, Major Garland Briggs (Don S. Davis) also hits Bobby Briggs (Dana Ashbrook) because he has been rebellious, while the mother Betty (Charlotte Stewart), used to it, just speaks nonchalantly.
Dr Lawrence Jacoby (Russ Tamblyn) has hidden half of the golden heart hidden inside an empty coconutand cries as he listens to a tape recording that Laura made.
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