Still recovering from the loss of Elizabeth the family begins to fall apart in some ways. Jimmy confesses about how much he did love Elizabeth, and while trying to hide from her own fears, Laura becomes addicted to laudanum. Emily tries her best to convince the Scottish relatives that she will give them everything she owns in exchange for New Moon, only to receive a reply saying the they are coming to P.E.I. to claim it.

Teddy falls down an embankment while playing hide and seek with Emily and Ilse. The girls try to reach him, but before they can Mad Man Morrison picks up Teddy and takes him to Dr Burnley. With this in mind, Teddy's possesive mother then plots to to convince Teddy that Emily and Mad Man Morrison are romantically involved.

When Aunt Laura's addiction to laudanum worses, Isabel takes the step of putting her in an asylum without asking anyone else. Meanwhile, New Moon is up for sale and Stuart is planning on buying it. Emily doesn't want Laura in the asylum and goes to get help via Jimmy, Dr Burnley and Uncle Malcolm.

As Emily and Ilse continue to grow older, the adults are faced with some questions that the girls will stop at nothing to get answers for: The facts of life. Meanwhile, Ilse's father, Dr Burnley has accepted a position at Massachusetts' General Hospital. Not wanting to leave, Ilse and Emily plan to run away only to have Uncle Malcolm ruin it by getting ill to the point he is close to death. Dr Burnley saves the day and begins to redeem himself in the eyes of Blair Water residents.

The Devil is in Blair Water, or so says the Reverend Nicholas Pitch who has arrived in Blair Water to rid the town of him. Hysteria immediately follows as the townspeople are suspicious of everything and blame the Devil. Meanwhile, the younger townspeople start to ask questions about the Devil.

Hysteria continues in what can be likened to the Salem witch trials. In all this it is Laura who become calm (the Devil has of course left her).

Despite disappoval from Eve's father, Abner, Jimmy plans to give Eve everything that she wants. Emily causes more problems when she gets the idea Eve is a Saint and wants it is be official by getting people to sign a petition. Abner is determined to keep the two lovers apart and finds Jimmy and Eve when they secretly rendezvous. After a struggle Abner Kinch is dead. One question remains, who killed him: Eve or Jimmy? Jimmy risks everything for the woman he loves…

Poor Baby Ollie is again being handed about after he is left on the Murray's doorstep.

Hoping to reunite Ollie with Maida Flynn, his mother, the children devise a plan. However their plans are not to be as Perry's Aunt Thom and new ‘friend' the Madame Marlena shatter the plans.

Isabel, knowing full well of Emily's plans, forbids her to enter into the ""Island Romance Contest"".

Having written the story of ""Isabella of the Highland"" Emily reluctantly puts it away only for Ilse to find and submit. When it wins first prize Isabel wants Emily to renounce the award and takes both her and Aunt Laura to Charlottetown to do it.

Ian Bowles makes a return to the series with a pregnant Margaux Lavoie. Laura must face the truth as the lies and deceit become too much

The series returns and we find that Laura's wedding has not yet happened and that she is fighting a battle of the heart whether to marry Ian or not. Emily is now thirteen years old. Not wanting to see Laura marry Ian, Emily and Ilse are overjoyed when the news that Laura is thinking of cancelling the wedding reaches them. Things don't got to plan however when fortune's wheel decides to turn and Laura never gets to tell Ian as New Moon battles to find answers…

Ollie Murray who has been without his mother for a year is finally re-united with her. In the time which she has been gone much has changed in Blair Water, especially the death of Ollie's father, Oliver Murray Snr. who died in the Klondike. Maida sets out to prove her love for her son, but there is still the possibility that Maida is only after the gold which Oliver Snr. left his son.

Emily and Ilse write an article ""Kicking the cat"" for the newspaper. The problems begin once people start taking the advice of the column and misunderstandings in love begins. Then Mr Carpenter returns and falls in love with Isabel Murray.

The truth is sometimes better left on the shelf and that is what Emily learns when she tries to overcome her writer's block. Deciding to write about what she knows she sees Rhoda's mother, Velma, as the perfect subject. ""Confessions of an Adulteress"" causing more problems when Rhoda falls for Harrison Bowles who is visting New Moon, soon Rhoda is losing control of all angles of her future.

While her friends all head off for Shrewsbury Emily is left behind in Blair Water because her Auth Ruth refuses to have Emily stay with her. Bitterely disappointed, Laura tries to cheer her up by telling Emily that she has left Ian for good. An ally of sorts then comes to Emily's help and her future takes a turn for the good, but things aren't so good for Laura who discovers something unexpected.

Perry returns to Blair Water only to be leaving shortly to fight in the Boer War. Other strange occurances are also going on with a love letter finding its way to Cousin Jimmy and a stranger coming to town.

Emily is feeling as happy as can be and has been writing for weeks and sending her work off.

As she is waiting Rhoda takes off with Emily's mail before she gets a chance to see it. She does this for a while as Emily is receiving acceptance letter and money cheques from a New York publisher Thelonius Grand. Her plans goes astray when the publisher days that he is coming to the island to meet Emily.

It all comes out in the end although Rhoda nearly pulls off the scam only to have Emily give her a gift.

Ian also leaves New Moon and is believed to have committed suicide. He gave his rights up to Laura for New Moon and she is left to raise Margaux's son.