Dr. Michael Rossi arrives by train in the New England village of Peyton Place, Massachusetts. He is met by young Rodney Harrington, whose Aunt Laura was married to Dr. Donald Brooks, Peyton Place's recently deceased GP. Rodney and his girlfriend Betty Anderson drive Rossi to the inn. Later, Rod stops by the office of his father Leslie, who manages the Peyton Mill. Rod discovers his father locked in a passionate embrace with secretary Julie Anderson, Betty's mother. Leslie attempts to explain the situation, but Rodney leaves in silence. Leslie assures Julie he will make his son understand, but she's skeptical. Rod's unwillingness to comment on his sudden aloofness angers Betty. He takes her home then drives wildly into the night, almost hitting virginal Allison MacKenzie. Rod offers Allison a lift home. Her innocence touches him, and he impulsively kisses her. She withdraws, stating flatly that he can tell everyone she's frigid. Rod says she can tell everyone that he's dumb, prompting A

Leslie Harrington and Julie Anderson's affair is having an effect on several others: Julie's daughter Betty has come to the realization that Rodney, Leslie's son, is avoiding her---and Leslie's wife, Catherine Peyton, suggests that Julie give up her job as Leslie's secretary now that her husband, George, has gainful employment. Mike Rossi has a flicker of recognition when he encounters Constance MacKenzie at her book shop, sending Connie into a panic. She confesses to Matthew Swain, family friend and editor of the local newspaper, that Rossi was an orderly at the NYC hospital where daughter Allison was born. Matthew advises her to be truthful with Rossi about her questionable pregnancy. Laura Harrington Brooks offers to assist Rossi with the management of his practice.

With Allison out of the house on a date with Rodney, Matthew Swain urges Constance to tell Allison the truth about her father so they both can get on with their lives. Dr. Rossi has dinner with Laura Brooks, widow of the doctor he has replaced at Doctor's Hospital and Leslie Harrington's sister. At the local teen spot, the Shoreline, Betty makes a spectacle of herself in order to get Rodney's attention. Norman, Rod's younger brother, keeps Allison company in the Shoreline while Rod is outside with a persistent Betty, who insists she must talk with him.

Rossi intercepts Betty before she gets to Rodney and questions her intentions. Although she wants to be Rod's girl, Betty expresses reluctance in entrapping him. Later, Betty presses Leslie Harrington for the reason his son rejected her. Unwittingly, Leslie reveals that Betty's mother, Julie, was in the office with him when Rod came in on that fateful night. George Anderson speaks with Dr. Rossi about his medication. Rossi, more concerned with George's violence toward his wife, suggests psychiatric therapy. Leslie confesses his slip of tongue with Betty to Julie, who decides to resign from her position at the mill. Unhappy in his own marriage, Leslie is not yet ready to give up on Julie. Watching Rod and Allison dancing in the bandstand, Betty determines to make him aware of her pregnancy.

Constance and Matthew are invited by Dr. Rossi to join himself and Laura Brooks at the Colonial Post Inn, where Laura can't help but make some jealous barbs toward Connie. Jealous George tells Julie he saw her with Leslie Harrington, prompting Julie to reveal that she has quit her job as Les' secretary. George further tells her that Dr. Rossi recommended him to a Boston psychiatrist. Allison doesn't like Rodney referring to her as a ""fair lady"" and wonders if he used the title on Betty. Later, George rescues Allison from some annoying motorcycle bikers and takes the opportunity to question her about Rodney. Prompted by Betty, Rod finally agrees to speak with her in private and they go off in his car for a drive. She reveals to him that she knows about the relationship between her mother and his father---and confesses her pregnancy. Stunned, Rod agrees to marry her but doesn't want to hear her admissions of love. In his agitated state, he drives directly in front of an oncoming tr

Betty attempts niceties with her new mother-in-law, but Catherine is perfectly cold toward her. Norman uses his mother's illness as an excuse for her rude behavior. Betty pays a call on Dr. Rossi, who urges her to tell Rod the truth about the baby while, later, her father reassures her on her course of action. Having already made plans with Constance, Rossi declines a country club date with Laura Brooks, who observes them driving away. Constance is visibly upset when Rossi takes her to the old Carson cottage, which he has rented from Eli Carson, a bronchitis patient. Constance reveals that a woman was murdered in the cottage around the time of the war.

Returning to the Harrington home following dinner with Betty's parents, Rodney learns that his mother has been rushed to the hospital. Betty, who has just had an argument with Rod, presses him to go without her. She packs a bag and heads for the bus station, but is ultimately dissuaded from leaving town by Allison MacKenzie. Believing Catherine can't wait for Morton's arrival at the hospital, Rossi once again pressures Leslie for permission to operate. Leslie reluctantly agrees. Midway through surgery, Morton arrives and causes commotion in the operating room by insisting he take over. Despite Rossi's efforts, Catherine Harrington expires. Learning of his wife's death, Leslie admits he should have waited for Morton, who denies Rossi's request for an autopsy and vows to run the younger doctor out of town.

Old Eli Carson suffers an angina attack in the town square and is attended to by Dr. Rossi, who instructs Laura to have Catherine Harrington's autopsy rescheduled. Chief of Staff Dr. Morton pulls rank and proceeds with the autopsy. Underage Norman Harrington is refused liquor at Ada's Tavern and proceeds to get into fisticuffs with some ""wharf rats"". Discovered by Rossi and the MacKenzie women, he accuses Rossi of allowing his mother to die. Allison comforts Norman and brings him to the Harrington home. Betty is unusually cordial towards Allison, thanking her for preventing her from leaving town and wondering if they could become friends. Driving Allison home, Rodney professes that his feelings toward her haven't changed; Allison later confesses the same emotions to her mother. When he returns home, Betty finally makes a full admission to an incredulous Rod regarding her deception about their baby.

Failing to heed Kennerling's request, Leslie insists they get on with the reading of the will. As he predicted, Leslie is bequeathed all stocks in the Peyton Mill, while Dr. Morton receives 15% of any dividends accrued to be used for the hospital. Her sons, Rodney and Norman, equally share cash assets upon reaching their twenty-fifth birthday and Laura Brooks is given all of Catherine's clothing---minus jewelry and furs, of course. Laura declines Catherine's token gift. Leslie's victory, however, is short-lived: William Kennerling, Peyton's Boston attorney, arrives to inform Harrington of a codicil to the will wherein all stocks revert to Martin Peyton, in effect disinheriting Leslie! George Anderson suffers a minor crisis when he loses a client; and daughter Betty seeks her mother's advice about accepting Rodney's inheritance in exchange for ending their marriage. Although Constance and Dr. Rossi's relationship continues to blossom, she fears that Elliot Carson will return to town u

Rossi is summoned to the Anderson home and quickly sums up the domestic situation. George is taken to Doctor's Hospital where, when ordering x-rays for his patient, Rossi is reminded that his privileges are suspended. Dr. Morton arrives at the hospital to loudly reiterate the fact. At Rossi's suggestion, Julie goes to stay at the MacKenzie home. Betty pays a call on her mother, seemingly holding Julie responsible for the problems in the Anderson marriage. Recalling the kiss Rodney witnessed between Julie and his father, Betty wonders how many other times the two were intimate. Rossi barges in on Dr. Joe Bradley, who becomes visibly nervous when confronted with the inconsistencies in his last surgery five years before. Shaken, Bradley seeks out Morton and reveals that he lied about the Harrington autopsy out of a sense of obligation to Morton for having saved his career after the Swain surgery. Morton sends Bradley into ""hiding"".

Dr. Rossi finds Elliot lurking outside his cottage and invites him in for a drink. Elliott states that he isn't sure he wants the cottage back. Mr. King returns to George's office and finds him barricaded inside with a gun. Mr. King phones Julie at Connie's house to inform of her the situation with George. Julie leaves for the professional building, instructing Connie to call Dr. Rossi. Rossi and Julie converge at George's office and hear a gunshot, but Rossi restrains Julie from going in. Elliot arrives as townspeople gather outside. He persuades George to let him in. Elliot distracts George with old war stories, managing to grab the gun and subdue him. Dr. Rossi tells Julie that George is a manic-depressive and will require extensive treatment in a sanitarium. Elliot visits Connie at the Book Gallery and begs her not to be afraid of him. She replies that her only concern is Allison, who knows nothing about her true parentage. Elliot reassures her that he wouldn't do anything to hurt

Allison and Connie are disappointed when Julie reveals that it's time she moves back home. Later, Dr. Rossi visits Julie and offers her a job as his secretary, replacing Laura who has left for Europe. Julie counters that she doesn't have any medical experience, but Rossi assures her that he isn't making the offer out of pity. He needs a good adminstrative assistant to handle his books and schedule patients. Julie agrees to consider the offer. Rodney runs into Allison at Peyton College, where she is meeting with her advisor. Rodney admits that Connie has discouraged their friendship. In New York, Betty meets Sharon at an exclusive boutique where Sharon urges her to try on an expensive fur coat. Sharon tells Betty that the fur suits her, and she would be wise to ""get smart"" [become a kept woman]. Elliot attempts to refill Eli's prescription at the pharmacy and receives a frosty reception from Calvin Hanley who reminds him that he visits his daughter's grave every Sunday. Elliot reiterate

Betty answers the phone in Sharon's apartment and speaks to Sharon's mother. Betty realizes that Sharon isn't much different from herself, a small-town girl with very humble origins. Betty phones Julie, who reveals that George has suffered a nervous breakdown and is confined to Greenvale Sanitarium. Sharon comes home to find Betty packing a suitcase. Sharon begs Betty not to leave as she has grown very fond of her, but Betty insists she has to return to Peyton Place. Paul and Calvin Hanley have an awkward father/son moment. Calvin reassures Paul that he did the right thing by testifying against Elliot in the murder trial. Connie gives Allison the sweater Elliot bought for her. Elliot encounters Norman, Allison, and Paul skating at Baker's Pond. Julie phones Rodney with news that Betty is coming home, but Leslie warns him that Blaine has information about Betty's escapades in New York.

Betty meets Leslie at the Mill and offers to annul her marriage to Rodney in exchange for Leslie's promise to pay George's medical fees. Leslie agrees to the deal. After Betty leaves, Detective Blaine brings his report about Betty's friendship with Sharon Purcell. Leslie locks the report in his desk without reading the details. Allison receives a portrait of herself sent by a secret admirer. Betty drops by the Harrington mansion to retreive her belongings. She and Rodney have a pleasant meeting that ends with Rodney kissing her. Allison meets Paul at a Peyton College art exhibit and realizes that he was responsible for her portrait. Rodney spars with Paul, obviously jealous that Paul seems interested in Allison. Elliot demands that Connie face the past and asks how she feels about him now. They argue, and Elliot breaks the photo of the fake ""Mr. Mackenzie"" that sits on the fireplace mantel.

Allison wishes Eli a bon voyage before his trip to Florida. Elliot reveals to Eli that Allison is his granddaughter, the product of his affair with Connie 18 years ago. Allison argues with Connie about the New York trip and laments to Matt that she has a right to know what happened to her mother there so many years ago. Robert Wainwright, Martin Peyton's lawyer, questions Elliot about the murder of Elizabeth and asks if Elliot knows the identity of the man Elizabeth was seeing. Elliot says he doesn't, then asks if Wainwright knows. Leslie and attorney Theodore Dowell talk about Les' relationship with Elizabeth. Later, Leslie denies to Elliot that he and Elizabeth were having an affair. Rossi finds a drunken Paul Hanley lurking outside his cottage. Paul reveals that his late sister lived there 18 years ago. When Elliot arrives, Paul nervously excuses himself and quickly leaves.

Julie and Nurse Choate clash at the hospital. Dr. Rossi convinces Betty not to quit her job without giving it a proper chance. Rodney and Allison meet for a skiing trip, while Norman laments that he is tired of ""going downhill"". Elliot admits to Leslie's attorney that he has a copy of Elziabeth's diary and can prove she and Leslie were having an affair. Julie and Betty worry about George's trial visit.