Aang and his friends stumble upon a town celebrating an Anti-Avatar Day. The villagers blame the Avatar for killing their leader, Chin the Great, in a past life and Aang is arrested and tried for his crimes. After Fire Nation soldiers attack the village, Aang is pardoned after he defeats them. The town consequently changes the anti-Avatar celebration into a pro-Avatar celebration. Meanwhile Zuko had disguised himself as the Blue Spirit to steal food for him and his uncle. Iroh is not happy with what Zuko is doing, and Zuko decides to leave him.
Momo spots a spider that has made a web in Sokka's mouth, due to the fact that he was sleeping with his mouth open. The lemur grabs the spider and ends up waking Sokka, who yells at Momo in response, and who in turn ends up waking Katara and Aang. His outburst attracts the attention of a mounted Fire Nationmilitary unit known as the Rough Rhinos, who surround them.
In their attempt to leave quickly, the trio instantly realizes that they each left a precious possession behind at the camp: Katara's waterbending scroll, Aang's staff, and Sokka's boomerang. Katara and Aang take advantage of their bending abilities and retrieve their desired possessions while Sokka is the only who is unable to retrieve his. He feels angry that the two spent the time to get their possessions back despite the danger and did not spare time for his. Katara simply confirms the fact.
While purchasing supplies, Aang, Sokka, and Katara learn of a festival known as "Avatar Day", celebrated in an Earth Kingdomvillage. They watch a parade with giant floats that are made to look like AvatarsKyoshi, Roku, and Aang. The trio at first believe that the festival is honoring the Avatar, and Aang is very satisfied with the fact. However, a man appears and torches the three floats to the loud approval of the villagers, who chant, "Down with the Avatar!"
Aang reveals himself as the Avatar, only terrifying the villagers as they fear he would destroy them. He is told by Mayor Tong to leave the village as he is an unwanted visitor. When Katara states that Aang helps people, Tong scoffs at the suggestion, explaining that it had been Kyoshi, Aang in a past life, who the villagers believed to have killed their former leader, Chin the Great. In an attempt to clear his name, Aang agrees to stand trial. He is imprisoned, however, as the town does not accept Water Tribecurrency to cover bail, leaving Sokka and Katara to investigate. After hearing Mayor Tong's description of Chin's statue and his account of Kyoshi emerging from the temple to strike the emperor down, Katara realizes that Kyoshi would never have set foot on the island if the temple and statue were carved out of the same stone and the statue was built following Chin's death.
After some searching, they also discover a footprint at the end of the island, which would prove to be some evidence later. Sokka and Katara return to Kyoshi Island to find evidence that can help prove his innocence. They are welcomed with cheers from the islanders, including the foaming mouth guy, but the indigenous become disappointed when they realize Aang is not accompanying the visitors. Katara and Sokka briefly state their business to Oyaji, who subsequently takes the them to the Kyoshi Shrine. Inside are several relics belonging to the past Avatar, as well as a painting, "The Birth of Kyoshi", through which they find out that Kyoshi was there founding the island at the very same time she supposedly murdered Chin the Great. Katara also discovers through looking at Kyoshi's boots that the size of her feet were big, the biggest of all the Avatars she is told, and she begins to conclude when Sokka interrupts and proceeds with what she was going to say: Kyoshi's supposed murder of Chin the Great was unlikely as the footprint they previously saw was small, hence further proof.
The evidence is useless because in these trials, the opposing sides only tell what they believe happened. Using only the two stories, the jury decides who is innocent and who is guilty; for this case, the village mayor serves as both prosecution and jury. Meanwhile, Aang, still in his jail cell, has become somewhat friendly with the other prisoners. One of them offers him advice about girls, that is, Katara.
During Aang's trial, after hearing Tong's story and Aang's vague version, he is found guilty. Refusing to give up, Sokka and Katara have Aang dress up in Kyoshi's old uniform.
Suddenly, Kyoshi manifests through Aang's body, much like Avatar Roku did during the winter solstice at the Fire Temple. She announces to the village that she did indeed kill Chin the Great, or Chin the Conqueror, as she calls him. He was conquering neighboring lands and was planning on conquering Kyoshi's village, so to protect her people, she went to confront Chin's army alone, coming face to face with the surprisingly short warlord. However, instead of fighting, Kyoshi broke the entire peninsula off from the mainland, pushing it away to form Kyoshi Island. In the process, Kyoshi's airbending scattered Chin's army. Chin himself was left standing on a by now weak overhang at the end on the cliff. He cried out in frustration, but because he was too stubborn to walk away, he fell to his death when the ground broke off from under his feet.
Once Kyoshi disappears, Aang asks Katara what happened, and she tells him that he confessed to the murder. The village brings out a wheel for Aang to spin to determine his punishment. It lands on being boiled in oil, but before the sentence can be carried out, the Fire Nation soldiers from earlier arrive to take over the village. Fearing for his safety, the mayor quickly changes the punishment to community service and pleads with Aang to "do a service to the community" by defeating the warriors, consequently saving the village. The trio engages the warriors in battle and is successful in driving them away. Sokka regains his boomerang during the battle exclaiming, "Boomerang! You do always come back!" In an act of thanks, the mayor decides that in the future, Avatar Day will honor the day Avatar Aang saved the town from the Rough Rhinos. Since Aang was not boiled in oil on that day, the celebration involves eating effigies of the Avatar made from unfried dough. When all is said and done, Sokka comments that Chin Village is "by far the worst town [they have] ever been to".
Meanwhile, ashamed of the position that he is now in, Zuko disguises himself as the Blue Spirit to steal from the wealthy. Worried about how Zuko is taking to the situation, Iroh tells Zuko, "In the darkest times, hope is something you give yourself. That is the meaning of inner strength." After thinking about what his uncle said, Zuko decides to travel alone.
Sokka foreshadows events in season three as he speaks of losing his boomerang, Aang losing his arrow, and Katara losing her hair loopies. These things come to occur over the course of the third season. Sokka loses his boomerang and his sword in the finale, Katara stops sporting hair loopies as to not look Water Tribe while undercover in the Fire Nation, and Aang is forced to grow hair and cover his arrow during the same period.
However, Aang wears his headband with its design pointing downward to resemble his arrow tattoo.
When attacked by the Rough Rhinos, Sokka, Aang, and Katara all forget to take a certain possession of theirs. Katara claims to have forgotten her waterbending scrolls, even though they were given to Aang in "The Avatar State" by Master Pakku.
When the merchant asks Team Avatar if they are going to the festival, Sokka is seen crying. The white part of his eyes are the same color as his skin.
When the group is watching the Avatar statues roll by, Momo is on Sokka's shoulder the whole time; when the guy with torch runs by and the camera is behind Sokka, Momo disappears, but suddenly reappears in the frontal view.
In the beginning, when Zuko, disguised as the Blue Spirit, steals food from two people, some food was seen spilled on the ground. When he disappears, however, the there is no longer any food on the ground.
If the shot is paused when Sokka is making a sweeping motion with his hand, his glove can be seen as solid with no slit for his first two fingers.
Even though Sokka had left his boomerang behind, when Aang is first shown in prison, it can be seen on the former's back.
In "The Warriors of Kyoshi", a large mountain could be seen behind the Kyoshi Island village entrance. However, in this episode, the mountain is no longer there.
When Katara and Sokka first see Kyoshi's boots on Kyoshi Island, they are brown. Yet when Aang is wearing them at Chin Village during his trial, they are black.
When the scary prisoner first appears, he is shown with thin eyebrows; however, when he is later seen giving relationship advice to Aang, he has no eyebrows.
Avatar Kyoshi took out one of her fans to airbend at Chin the Conqueror, but before she split the peninsula to create Kyoshi Island, both of her fans were in her belt.
During Kyoshi's flashback, Chin can be seen firmly planting his foot in the ground, making the footprint Mayor Tong shows Katara and Sokka. When Chin falls, however, the ground underneath both his feet gives way, meaning the footprint should not be there anymore.
After Avatar Kyoshi's flashback finishes, the close-up of Kyoshi's face has a large animation error, containing an unhidden layer of duplicate tassels and hair.
When the scene shows a frontal view of Mayor Tong sitting between the civilians, there is a woman with a shorter man beside her. When the scene cuts to a side-view of the mayor, the woman disappears.
When Zuko leaves on the ostrich horse, in the first scene the tail is white, but in the next scene the tail is brown.
When the Wheel of Punishment landed on the "boiled in oil" punishment, the image to the right appears to be someone lying on a bed of nails. When the mayor moves the wheel one space to the right later, the picture is of community service. However, when Aang prepares to face the Rough Rhinos, the order is back to boiled in oil, nails, and community service.
When the Rough Rhinos arrive to attack the village, one of them is already directly next to the statue of Chin. However, he was never seen coming down. When he cuts down the statue, the statue does not go down with the cut at all either.
This is the first time in Book Two that Zuko mentions his goal of capturing the Avatar.
When gathering evidence, Sokka wears a goofy-looking hat and pipe. This is likely a reference to the detective Sherlock Holmes, a character in a popular book series by Sir Arthur Conan Doyle, who is often portrayed in films wearing a similar deerstalker hat despite never wearing one in the books. That peculiar hat was first worn by the calm man in "The Fortuneteller".
Even though Kyoshi confesses, in the flashback, it shows that she did not actually kill Chin the Conqueror. She merely caused the conditions which led to him falling off the cliff. In the finale of the show, when Aang comments on how Kyoshi technically did not kill Chin, she blankly responds: "Personally I don't see the difference, but I assure you I would've done whatever it took to stop Chin."
This is the last episode prior to Toph's introduction.
The bailiff repeatedly refers to Aang as "it", either unsure whether it is Kyoshi, a female, or Aang, a male, that is up for trial, or in an effort to further humiliate the Avatar, denying him humanity even in the pronoun used to address him.
Aang's fellow prisoners give him the advice that he has an advantage as the Avatar with the ladies. This is similar to what Roku said to Aang during Roku's wedding flashback in "The Avatar and the Fire Lord".
This is the only episode in Book Two, prior to Toph joining the group, where the kids do not mention the search for an earthbending teacher.
This is the first time hair loopies are mentioned by their name.