When Mrs. Berg learns that her old lover is coming to visit her, realizing that her lie of running the school has come back to haunt her, the kids help her pose as school principal. Gordon, a squeamish animal-loving student has difficulty in Chemistry class with dissecting frogs so he and Reggie try to convince Mr. Dyrenforth to approve a simulation computer program that provides the ability for virtual dissection.

After helping her out when she gets kicked out of her English class, Reggie's close friend and the cafeteria lady, Rose, joins the school of the arts under Reggie's suggestion but when asked to audition with Reggie for a summer stock company, Rose gives up on both the stock company and the school but rekindles her passion for performing.

Doris is auditioning to star in a show. She falls and bumps her head and has an elaborate dream sequence in which she is on a quest to become a star. The school campus is set up with a ""yellow brick road"" path ""Dottie"" must follow and encounters several interesting characters (her fellow classmates in costume) along the way. Debbie Allen (the dance instructor/choreographer) plays the ""good witch"" and Mrs. Sherwood is the ""wicked witch.""

After an eventful party, Miss Grant is frustrated to learn that Danny and Nicole have not shown up for an important rehearsal. That frustration turns to grief when they learn that Nicole was killed while being driven home by a drunk driver, Mickey Garth. With the school grieving, Jesse takes it the worse vowing to kill Mickey.

The school is trying its hands at its first video yearbook and with alumni week in session, Bruno, Coco, Doris, Montgomery, Holly, and Chris are interviewed for the video. Miss Grant recommends Leroy for a lead in the alumni week show which is to be choreographed by big-time graduate Michael Taftner but he is not convinced that Leroy can take on the part. When Chris is asked to be guest speaker for Mr. Seger's class, he lies about his success which the two but heads over.

Jesse presents his 30's-styled play to Mr. Dyrenforth who decides to fund the play with hopes of obtaining the prize money of $20,000 from the Kimble foundation. The board decides not to supply the funds but Lou Mackie donates the necessary production money. All is well until Nicole, who plays lead comes down with Laryngitis.

The School of the Arts has been selected as the location for director Jeff Stave's new film "Kittens Go to High School." Appointed student assistant to Mr. Stave, Jillian falls for him but reality sets in and it becomes clear that they can't be together. Maxie Sharp, the lead actress in the film enrolls at the School of the Arts.

The kids suspect the ballet teacher is prejudiced against black students. They protest by stopping whatever they are doing and standing silent. It isn't til Miss Grant talks with this teacher that they know for sure that she feels black dancers don't have what it takes to be great. She is shown how wrong she's been during a performance by Stephanie. Bruno must escort a young musical prodigee around the school.

After a series of school lockers are vandalized, Dwight finds a suicide note and Doris tries to enlist her friends in helping her find the note's author.

The National Cultural Center selects The School of the Arts to contribute an item to a time capsule to be opened a century later but no one is able to agree on what that item should be. When Mr. Shorofsky gives Miltie an ultimatum; write a song or fail, he tries to pass off a fourteenth century ballad as his own.

After being reacquainted with an old actor friend, Paul Seeger, Lydia gets him a job as an acting teacher at the School of the Arts. His toughness isn't received well at first by the kids, but as he opts to leave, they have a change of heart. Danny is asked to give a tour to Hannah Cooper an 11 year-old prodigy who's unwilling to play for anyone.

Nicole gets the opportunity of a lifetime when she's invited to sing back-up for her idol Frannie Fortune but Nicole gets a quick lesson in the dog-eat-dog nature of the business. After Mr. Dyrenforth reveals that he's lonely, Danny, Jesse, and Leroy decide to boost his love life by advertising the principal with his plastered pictures all over the city.

When her grandmother dies, Coco questions her decision to become a performer. The kids attempt to find Julie's stolen cello.

Doris' draft dodging brother comes back and she tries to get him and her father to talk to each other. Lydia tries to sneak ballet moves into a jazz dance number when she discovers her old ballet teacher is coming to watch the performance.

Danny's grief over the death of Mr. Crandall threatens to cause his expulsion, but help comes from an unexpected source.

Bruno accepts a challenge from Miss Sherwood to try to create "art" from a computer and when the school acquires one, he's delighted, until he learns that the machine's purpose is to replace Mrs. Berg.

When Danny's old friend comes to visit him, he surprises him with more than the news that he's working for Lou when he reveals to Danny that he's gay. Danny has an especially difficult time dealing with his friend's homosexuality. Leroy and Miss Grant compete with their choreography with a spot for the winner's routine to appear a stereo store's local commercial.

Bruno's script is chosen to be produced by the school and he is given the chance to be a voice in the audition process. Unfortunately he can't make up his mind who is better and if someone isn't as good he (with his soft heart) feels the need to let the person try again, to give them that extra chance to get it right. All his friends are excited that he can choose who will star in it, because of course, they want it to be them. Things start to heat up after everyone finds out that Bruno cast himself in the lead. After which he enlists the help of Doris to teach him to ""act"". Doris begins to fall in love with Bruno.

Coco tries to get long with a learning disabled student.

Lydia teaches a blind substitute teacher to dance. Doris developes a crush on the substitute teacher, Jim Hamilton.

Doris alienates her friends when she becomes obsessive over the planning of this year's "Friendship Day". Bruno's father and Julie's mother mistakenly believe that Bruno and Julie plan to have sex.

On the anniversary of Leroy's commencement as a teacher at the School of the Arts, he's faced with accusations that he picked one student over the other for the lead because she was Black. Mr. Shorofsky and Ian butt heads on their tastes in music.

Mr. Dyrenforth is due for appendicitis and the board elects Ms. Fleming to fill in for him. Ms. Fleming enforces a doctrine that prohibits singing and dancing in the hallways. Miltie, in an effort to finally do a good deed, dresses up as the Crimson Blade and anonymously performs various acts of heroism.

When Ian's old girlfriend visits him, feeling homesick and missing her, he decides to go back to England something to which she objects. Mr. Shorofsky wants to send Ian to a competition for classical guitarists and Ian openly objects. The gang prepares Lou for his campaign for President of the Metropolitan Bowling Operators Association.

Julie's dad is getting remarried, and Julie does not like it one bit. Also, Leroy tries out for a touring dance troupe.