Blake gets a meeting with Logan Rhinewood set up. Steven goes to Hollywood and finds Sammy Jo modeling in a cheap studio. Blake and Cecil takes a blood test and it proves that Blake is Fallon's real father. Alexis and Cecil start flirting with each other. The last news about Matthew and Lindsay is that they are dead. When Claudia finds out, she blames Cecil and wants to shoot him. Krystle tries to stop her, and in their struggle, the gun goes off.

To raise the needed money, Blake sells his assets and mortgages the mansion. In a heated confrontation with Alexis, Tracy quits. Tracy tells Alexis of her ongoing affair with Dex. Alexis is again questioned by the police, who want the details of her affair with Mark. Fallon suffers another painful headache. Sammy Jo informs Steven she intends to stay in Denver and take custody of Danny. An unknown, beautiful woman, Dominique Devereaux, sweeps into La Mirage demanding the finest accommodations. When she attempts to question Fallon about Alexis, Fallon grows suspicious.

Blake's trial continues. Both Joseph, Claudia and Krystle have to testify. When Claudia testifies, she has to tell that she had an affair with Steven, and then Matthew finds out about it. He makes rebellion in the court room, attacks Blake and has to go to jail. Claudia packs her stuff, runs away, and takes Lindsay with her. On the way, they collide and get serious injuries. In the final scene, Jake Dunham calls in a new witness, and in walks a mysterious woman. It turns out to be Alexis Morrell Carrington - Blake's first wife.

Blake announces that his sight is back. Alexis sleeps with Cecil. Fallon and Nick are friends again and wants to be together as soon as the baby is born. Steven and Sammy Jo decides to leave the mansion. Fallon and Alexis throws a party for them. Sammy Jo gets drunk and embarrasses the Carringtons. Claudia and Jeff seems to be getting good along. Everything about Cecil being Fallon's father is out in the open between Alexis and Fallon. In the end, Alexis and Fallon has an accident with their car and Fallon is left unconscious.

Blake tells Alexis that Charles Matthews knew about Fallon's childhood nightmare. Matthews also knew that Blake's father, Tom Carrington, covered up the incident. Alexis blackmails Blake for half of the plundered Nazi treasure. Jeff and Dex enlist Zorelli's help to dig up information on Captain Handler. Fallon dreams of the lullaby she heard Krystina sing. She remembers the lullaby came from a music box that was part of the treasure. Fallon asks Krystina to show her where she found the music box. Alexis offers to give up her claim for half of the treasure, sparing Blake public scorn, if Sable withdraws her lawsuit against Colbyco. Sable agrees. Krystina leads Fallon into a secret tunnel passage and to the hidden treasure, unaware that Dennis Grimes has followed them. Handler meets with the mastermind behind the scheme to steal the treasure, but his identity is never revealed. Grimes takes Fallon and Krystina hostage inside the tunnel. Handler and several police officers raid Blake's ma

Fallon is brought to the hospital and gives birth to a boy. The baby is very weak and the chances for survival are small. Fallon is deeply depressed after finding out about Blake not being her father, and doesn't want to see nor Blake or Alexis. Claudia sleeps with Jeff and steals his key to the archive in Blake's Denver-Carrington. Krystle talks to the groundsman at the mansion and finds out about Alexis' shooting when she lost the baby. Alexis and Krystle have a real ""catfight"" in Alexis' studio. Alexis' detective, Morgan Hess finds out that Krystle is not legally divorced from her former husband, Mark Jennings. Sammy Jo leaves Steven.

Fallon and Jeff's baby has a surgery and things are looking better. Jeff discovers Claudia's ""leak"" to Cecil. Matthew and Lindsay disappears without trace in the jungle. Blake finds out about all the ""father"" trouble. Alexis blackmails the groundsman to tell Krystle he was wrong about Alexis shooting the horse, though Krystle won't believe him. Fallon and Jeff argues about custody of their child.

When Blake learns Steven's attorney Chris has moved in with his son, he vows to fight for custody of little Danny. Morgan Hess, Alexis' private investigator asks his employer for a large sum of money to payoff a gambling debt; when Alexis refuses, Hess leaves with a threat. Kirby realizes her baby was fathered by Adam. Fallon meets with Adam's former physician, Dr. Edwards, who tells her of Adam's temper and underlines his brilliance: He once won a case by proving a plant worker was poisoned and driven insane by chemical fumes. Realizing the connection to Jeff's illness, Fallon asks the hospital to investigate. Alexis tricks Krystle into meeting her at Steven's cabin, where she offers her $1 million to leave Blake. Outraged, Krystle rises to leave, but the door will not open--someone has bolted it shut from the outside, and smoke is pouring in from under the door........

Krystle regains consciousness and finds herself locked in the attic at Delta Rho Farms while Rita is impersonating her at the mansion. Dex is caught and tortured in Moldavia. A furious Blake learns Adam lied to him by canceling a business trip to marry Claudia. Blakecuts Adam out of his will. Claudia is upset to find Michael has been appointed chairman of La Mirage. The Colby family attends Blake's party to announce the formation of the Carrington-Colby pipeline. Blake, however, continues to question Jason's integrity. One-time lovers Dominique and Garrett Boydston, Jason's chief counsel, are reunited. From his bedroom window, Jeff spots Miles Colby arriving with Fallon.

Blake is shocked when newspaper headlines announce Ben's acquisition of the South China Sea leases. Sure of Ben and Alexis' collusion, Blake greets the co-conspirators with copies of ""Sister Dearest,"" which he vengefully hands out to the hungry press. Claudia informs Blake that while ill, he gave Adam power of attorney to turn the Lankershim One oil well over to her. Disturbed that the well is nearly dry, Claudia becomes lost in a dreamlike past. Locking herself into a candlelit room, she accidentally sets the room ablaze. Sammy Jo and Amanda fight for Clay's affections during Dominique's engagement party. When a vicious struggle lands both women in the pool, Amanda holds a helpless Sammy Jo under water. Dominique's happiness is shattered when she learns that Garrett was never married before. After manipulating Ben into giving her one half of the leases, Alexis plots her ultimate revenge. Calling in her one billion dollar loan, Alexis renders a stunned Blake financially impotent. When

Alexis testifies against Blake, and tells about an incident several years ago, when Blake discovered her in bed with her lover, Roger Grimes. Her testimony proves that Blake is a violent man, and things doesn't look too good. Fallon and Blake welcome Alexis with hate and rudeness, but Steven is friendly to her. Claudia wakes up in the hospital and discovers that Matthew has run off with Lindsay.

Alexis prepares to have the wedding reception in Blake's garden. Rashid Ahmed's brother Farouk comes to Denver-Carrington to offer Blake a deal, but Blake turns it down. To get back at him, Farouk tells Nick that Blake is responsible for his brother's death. Steven leaves the mansion. Blake considers buying a big ranch and goes there with to look around. Blake goes alone for a ride in the mountains at the ranch. Nick follows him and starts accusing him for the brother's death. There's a big brawl, but they both calm down, and Nick leaves Blake alone. Blake's horse is then attacked by a snake. Blake gets thrown off and disappears down the hill. Nick watches Blake lying there unconscious, but leaves him. Little Blake disappears. Cecil has a heart attack when he's in bed with Alexis.

Cecil leaves his estate and ColbyCo to Jeff and Alexis. He also reveals his ""Rhinewood-game"" in his will. Blake suspects Alexis of being a part of it. Adam finds Alexis and shows her the silver rattle he had when he was kidnapped. Alexis believes him.

Alexis suffers recurring nightmares about Mark's death. Kirby again tries to kill Alexis. When she is unable to pull the trigger, Alexis offers to remain silent in exchange for Kirby's agreement to leave Adam. The truth behind the attempt to unhinge Claudia is revealed. Sammy Jo seduced Hess into handling it, and has returned to him now to solicit his help in regaining her child. In preparation for the wedding, Alexis and Krystle visit the same beauty salon. The two women exchange words, and a mud-slinging melee ensues. While dressing for the wedding, Fallon is gripped by a seizure. She drives off as the ceremony is about to take place. The police arrive and arrest Alexis for the murder of Mark Jennings.

Afraid that something may have happened to Dex, Alexis demands to be let into his room, only to find Amanda and Dex in bed together. Horror stricken, she vows to disown Amanda and storms from the room. Krystle confronts Alexis for initiating false rumors to a journalist regarding her captivity. Krystle overturns a table laden with food into a seething Alexis' lap. Galen assures Dex that he has lost Alexis forever and now she will be his queen. Alexis leaves for St. Thomas to get a divorce from Dex. Adam is dismayed to learn of Blake's plans to put Steven on the board of directors. While attending a party, Adam sees Bart Fallmont and Steven together and misinterprets it to mean something more. He immediately sets a conspiracy into motion to gather incriminating evidence against the senator. Garrett meets Jackie and after learning her age and the tragic story of having lost her father soon after her birth, Garrett suspects she might be his daughter. Back from St. Thomas, Alexis walks in

Convinced that someone is trying to frame him for Chisolm's murder, Blake turns to Charles Matthews for answers to his father's mysterious past. Matthews tells Blake a dark secret that leaves Blake in a daze. Zorelli finds a bug in his apartment, which Dennis Grimes, and Captain Handler planted. Jeff finds out that Adam was responsible for the story that accused him and Monica of being involved in an incestuous affair. Jeff confronts Adam and a serious brawl ensues. Walking in on the fight, while Sable and Monica watch, helplessly, Alexis uses the moment to announce that Jason Colby is not Monica's father. Outraged by Alexis' betrayal, Sable hurls herself atop of Alexis, pummeling her wildly. Adam tells Alexis that the painting Grimes gave her is a Fredrick Stahl. Putting the connection together, Alexis realizes Blake is hiding a treasure plundered by the Nazis. Sammy Jo tells Tanner that she loves him, leaving him torn between his vows and his love for her. Sable tells Dex that he is

Blake is arrested for the murder of Ted, and a big trial comes up. The prosecutor is Jake Dunham, an old friend of Claudia and Matthew, who does not like Blake. Krystle hears about the trial and decides to come back to Blake to be with him, and then solve their problems later. Fallon is afraid and to help her father, and she lies in court. Steven tells the truth about what really happened, though.

After losing her baby due to the fall from her horse, Krystle learns she cannot have another child. Steven and Sammy Jo begin dating, but at his cabin, he finds he cannot make love to her. Jeff quits his Uncle Cecil's business and joins Denver-Carrington. Fallon continues her affair with Nick Toscanni. Steven professes his love to Claudia and asks her to marry him. She declines, stating she's still in love with her husband. Fallon interrupts Nick's visit to Krystle in the hospital and angrily assumes the worst, demanding to know if she is ""another page in his appointment book."" Blake's attorney, Andrew Laird, returns from Washington with news of more trouble with the Middle Eastern oil leases.

Claudia keeps accusing Krystle about her relationship with Matthew during his marriage. Steven is on his way home from Hollywood when he picks up a guy who wants a ride to Denver. When they get there, the guy tries to blackmail Steven. Steven beats him up, and is arrested for assault. Cecil has chest pains and seems to be getting heart problems. Blake accuses Alexis of shooting at Krystle's horse and threatens her.

Fallon and Jeff's baby, Little-Blake Colby, is brought home. A nurse called Susan is hired to take care of him. Alexis accepts Cecil's proposal and they start making wedding plans. Claudia finally remembers exactly what happened the night she got injured. Rashid Ahmed wants to do more business with Blake.

Michael goes to Denver to find out who he is. Alexis and Cecil plan a wedding in the hospital. Claudia disappears and Blake suspects her of kidnapping the baby. There's an exiting drama on the roof of a tall building. Claudia has the baby in her arms and refuses to give her away, thinking it's Lindsay. She finally throws the baby over the edge, but it turns out it was only a doll.

Alexis and Adam get good along in their mother-son relationship, and Alexis gives Adam a job in ColbyCo. Blake starts believing Adam is his real son. Fallon and Adam keep flirting with each other, not knowing they are siblings. Adam has dinner with Krystle and Blake, but it ends with a conflict. Alexis gets a hold of Krystle's first husband Mark.

As Fallon plans to wed Peter, Claudia advises her of his womanizing. Fallon dismisses Claudia's concern, however, as she has with all the others who question the wisdom of her marrying Peter. Tracy sleeps with a newspaper reporter in exchange for a damaging story to scandalize Krystle. After Allegre is safely returned, Blake questions Jack Crager, the horse's trainer. After their meeting, Jack quickly phones Peter, who instructs the horse trainer to disappear until further notice. Distraught after learning that Peter has suddenly left the country, Fallon runs into the path of an oncoming truck. Jeff and Blake look on in helpless disbelief.

Blake's fortune now rests on the decision of a group of bankers, who will decide whether to extend his loan or call in the debt immediately. Alexis hires Tracy to obtain confidential information on Averell Dawson, Blake's banker. Shortly thereafter, Blake learns his extension has been denied. Jeff and Fallon celebrate their engagement. Sammy Jo arrives unannounced at the mansion, claiming she's come to visit her son. Mark questions Alexis' motives for destroying Blake and is reminded he's been paid to keep his mouth shut. Not satisfied with the monetary arrangement, Mark demands she submit to him sexually. Alexis orders him from Denver. A police officer arrives and announces that Mark Jennings has died after falling from Alexis' penthouse balcony.

After a twenty-year absence, Blake receives a visit from Jason Colby. Jason proposes the two tycoons build a joint pipeline. Although reluctant to do business with Colby because of his past shady dealings, Blake needs Jason's tankers to move his oil out of China. Jason confides to his sister Constance that he is dying. Jeff is surprised to hear from his aunt Constance, who insists it is urgent he come to California. Psychic Justin Dehner helps in the search for Fallon, who remains in California with Miles. Dex is furious with Alexis's growing obsession with Galen. Michael shuts Amanda out of his life. Gordon Barrett, assistant undersecretary of state, questions Blake about the revolution in Moldavia. In New York, Joel and Sammy Jo convince Rita to undergo plastic surgery to complete her transformation into Krystle's double.