C.C. explains her history with Mao, and how his inability to turn his Geass off drove him insane. An injured Villetta wakes up in Ohgi's apartment and he discovers she has selective amnesia. C.C. leaves Lelouch to take care of Mao herself, but Mao gains the upper hand when he incapacitates her. Lelouch utilizes his intellect to fool Mao and rescue C.C. from him, using the Britannian Police to surround and shoot Mao. Safe on a rooftop away from the scene, Lelouch affirms his contract with her, promising to not fall victim to his power as Mao did.

C.C. departs as a messenger to the Chinese Federation and Milly has a marriage interview with Lloyd Asplund, creator of the Lancelot. Mao returns to kidnap Lelouch's sister, Nunnally, and holds her hostage in the Ashford Academy sewers. Lelouch and Suzaku work together to rescue her, with Suzaku's physical adeptness and the clever use of Lelouch's Geass proving to be beyond Mao's planning. Before he can be arrested, Mao reveals that Suzaku killed his own father, and in return Lelouch silences him with his power. C.C. returns to the campus and finally ends Mao's life as Suzaku crumbles to the ground, confronted with his actions after years of secrecy.

An inauguration ceremony of Clovis' memorial art museum is being held, with Euphemia judging the art works. Lelouch agrees to help Kyoshiro Tohdoh's comrades rescue their leader and Shirley finds an old crumpled letter detailing her previous knowledge of Zero's identity. During the rescue mission, Lelouch convinces Tohdoh to join the Black Knights. The Lancelot appears and attempts to stop them, but Lelouch is able to predict its movements and plan a counterattack. When Tohdoh slices open the cockpit, revealing Suzaku within, Lelouch is shocked, having originally planned for Suzaku to become Nunnally's knight. He orders an immediate retreat as reinforcements arrive. Seeing Suzaku's bravery and creed, Euphemia announces to the media that he will be her knight.

As Euphemia knights Suzaku, Lelouch establishes the hierarchy of the Black Knights. Diethard Reid suggests assassinating Suzaku, but Lelouch has other plans for him. He launches a plan to disable and capture Suzaku and the Lancelot at a Britannia military base on Shikinejima. The plan almost succeeds, but Second Prince Schneizel el Britannia appears and orders his floating battleship, the Avalon, to bombard the island.

The aftermath of the Avalon's arrival inexplicably leaves Lelouch, Euphemia, Kallen, and Suzaku on the island of Kaminejima. Suzaku encounters Kallen while Euphemia is found by Zero. Suzaku learns Kallen is a Black Knight and pilot of the Guren Mk-II, and in turn tells her about how he killed his father. Euphemia confirms her suspicions that Lelouch is Zero. Schneizel, Lloyd, and Cécile Croomy survey the island's ancient ruins. When Lelouch, Kallen, Suzaku, and Euphemia suddenly fall into the ruins, Lelouch and Kallen steal the prototype Knightmare Frame Gawain to escape. Elsewhere, the exiled Japanese government from seven years ago launches a full-scale assault on Kyūshū with the help of the Chinese Federation.

The Britannian Army fights back against the Kyūshū invaders with the Lancelot. Meanwhile, Nina meets Princess Euphemia and inadvertently gives Euphemia peace of mind about her feelings for Suzaku. As Suzaku becomes cornered when his Lancelot's battery runs out, Euphemia encourages Suzaku to fight on and live. Zero and C.C. fly into the battlefield in the Gawain to recharge the Lancelot, and the two Knightmares end the Kyūshū campaign together.

The Ashford Academy holds their annual school festival. Ohgi, Villeta, Euphemia, and Kallen all make their separate ways to the event. A series of close encounters risks the revealing of hidden identities, but all those involved escape. Suzaku pilots the Ganymede for the festival's main event: making a giant pizza, slated to be the world's largest. When Euphemia's presence is revealed, mass panic ensues. On live television, she declares the Mount Fuji area to be the "Specially Administrated Zone of Japan", where Elevens can be referred to as "Japanese" again. She believes this will bring back the happy days with Lelouch and Nunnally, but Lelouch thinks otherwise, knowing she is being naive.